I see this question among many novice traders, as a matter of fact, this has been the perception from the start.
Why people lose money in the stock market?
The stock market has been around us from decades and also been playing a vital role in day to day lifestyle.
Although we do not realise this and hardly given any second look to the Nifty Charts or Sensex Figures. We are too busy attending our daily chores and obsessed with jobs 9-5, without realising there is a whole second world exists apart from our own known small world.
Well, To know, the answer to this Second Biggest Question, we need to know what is the stock market?
If you are wondering which is the first BIG question; “How to make money in the stock market?” is the first for your knowledge.
Let’s make this easy and understand the answer in simple points.
How do we decide how much money should we invest in the stock market? Best to my knowledge, people put money in the stock market usually they have left after spending. There are some who are into investing and trading in the stock market but not the majority I say. This is one thing we should plan on; How much money you want to spare for Investing or Trading in the stock market. If you ask me? I say for investing, you should really invest before savings and Spending. Here I am not suggesting you to cutting out on Daily expenses.
For Trading, You put money in a trading account (Demat account) which you can manage easily. Risk management is very important when it comes to securing capital in trading stocks especially Intra-day.
Do we really know anything about stocks we are investing in?
Social media platforms like Facebook, Twitter, Instagram, youtube are full of knowledge but can be misleading too. Some people are really just trading or investing based on other’s views and analysis. For instance, A doctor who operates on a live body and makes his first big cheque after 8-10 years of Learning, Hard work and practice. An engineer goes to the best university for admission to learn and practice. Likewise, Trading in the stock market is a profession and also needs learning and practice. Having a mentor can help you save time from making mistakes and learning from it. At ISM, Each mentor carries at least 10 years of trading and training experience. With the expertise and a strong support from the investors and management, ISM Delivers future leaders to the stock market industry.
Stock Market is a GAMBLE?
Confusing Speculation with investing is a myth. Investing means making a good decision and sticking with it for good. Acting on tips and call or wildly picking stocks for your portfolio is not investing. Studying a company, research on the business plans before investing without a time horizon is doing it the right way.Whether you are investing to fund your College education, Buying a property you should not forget return comes with risk. It is always recommended to go though the risk and policies specially investments with attractive returns. If one cannot stand with the trends of stock market then he/she should avoid stocks. One of the best way to make your investment with less risks is to avoid investing in startup companies and highly volatile stocks.
As warren buffet said,
“Don’t put all your eggs in one basket” or “Don’t test the depth of the river with both your feet while taking risk”?
Diversification or Investing Low-cost could be one thing that can save an investor or beginner in stock market from getting over exposed or burned. If you are interested in trading then Paying more brokerage fees to brokers in one thing you should give second look to. There are many traders who are now in to Investment but they have got the capital to invest in Long terms investment from Day- Trading.
Everyone as access to the same resources and information. Taking stock market for granted one of the big mistakes you will ever do. Researching before investing and Analysing before trading will reveal good returns on your investment and trading portfolio.
So, Do You think you are ready for Investing or do you want to start making money in stock market as Full Time stock trader.