Important lesson for the beginners, every one want to make money in stock market as quick as possible but learning is the most important part which most does not follow. Follow proper procedure is the key. Instead of following money follow the right procedure help you to become wealthy.
If you want to become a trader, investor first ask yourself are ready to enter the financial market. Want to become a day trader or an investor. Because many people are confused in between a trader and a investor.
Day trader or intraday trader trade take trade for a day square off the same day or hold the position for day or two based on his analysis.
Investor buys a certain quantity in particular stock hold for a certain time frame for example (from 6 month -10 years) according to his judgment and analysis.
Want to become a investor, thing to do or do
Investing is a thing you can do buy your own. If you are employee or business man you open a demat account and start investing.
First open a Demat account with any of the broker firm. There are so many broker houses in the country who offer their services. Demat account are for both trading and investing purposes. You want to buy stocks and hold them for long time you need demat account or You want to trade in stock future and stock options then also you need a demat account.
For opening a demat account certain documents needed. Like address proof, bank statement, Your ID, Photo, signature etc. Once you get in touch with the broker firm they will you address with all the formalities.
Once your demat account is active, your demat account is linked with your bank account, you can transfer your money from bank account to demat account and start investing your money in stock market.
For investor the most challenging part to identify the right stock, there is n numbers of options available, but identifying the right stock is very crucial. To identify right stock many investor read balance sheet, financial history, moving pattern, volume, moving average, stock support and resistance etc.
Once you identifying the stock, next question come how many quantity you want to buy in the particular stock. Many investors diversify their portfolio with multiple stocks. Investor invests in multiple stocks according to his interest like manufacturing, information technology, automobile, pharma, real estate etc. Investing in multiple stocks is also because if a certain segment is not doing well enough the other segment backs you. Invest all the amount can also become a harmful thing to do. Most of the successful investor makes average. For example once you buy a number of shares at a certain price or level and after that the price of the stock comes down so that case you can buy more number of shares and average your investment.