How to Invest in Share Market! Best way to Invest. Investing in Share Market.
Want to make money by Investing in Share Market? If your answer is yes, then let me explain what is share market, how it works, and how you can start investing in it.
What is the share market?
The share market is a place where people buy and sell shares of different – different companies. A share is part of a company’s ownership. When you buy a share, you become a shareholder of the company. You can earn money from the share market in two ways:
– Dividends:
Some companies pays dividends to their shareholders from the profits. Dividends are usually paid in every year or every quarter of a year.
– Capital Gains:
When the price of a share increases, you can sell the share for more price. The difference between the selling price and the buying price will be your capital gain.
How does the share market work?
The share market works like an auction. There are two types of participants in share market: buyers and sellers. Buyers are those who want to buy shares, and sellers are those who want to sell the shares. The price of a share is dependent on demand and supply of the share. When more people want to buy a share, the price goes up. When more people want to sell a share than buy, the price goes down.
The share market is regulated by the authority called SEBI (Securities and Exchange Board of India). SEBI ensures that the share market operates fairly and transparently. SEBI also protects the interests of investors and prevents frauds and scams in the market.
How to start investing in the share market?
Steps to Follow to Start Investing in the Share Market:
– Open a Demat Account:
A Demat account is an account where your shares are stored electronically. You can open a demat account with any bank or broker that is registered with SEBI.
– Open a trading account:
A trading account is account where you can place order to buy and sell shares. You can open a trading account with any broker that is registered with SEBI.
– Link your bank account:
You need to link your bank account with the demat and trading accounts. This will enable you to transfer money to and from your accounts.
– Choose a broker:
A broker is intermediary who helps you execute your orders in the share market. You can choose a broker based on their fees, services, reputation, and customer support. Examples are: Zerodha , Upstox etc.
– Research and Analyse:
Before you invest in any share, you need to do some research and analysis. You need to study company’s financial performance, growth prospects, competitive advantage, future plans, etc. You also need to check the price trends, valuation ratios, dividend history, etc. of the share.
– Invest wisely:
Once you have done your research and analysis, you can start investing in the share market. You need to invest wisely by following some basic rules:
– Invest only what you can afford to lose:
The share market is risky and very volatile. You may lose some or all of your money if the price of a share falls drastically. Therefore, you should invest only what you can afford to lose without affecting the essential needs.
– Diversify your portfolio:
You should not put all your eggs in just one basket. You should invest in different shares of different sectors and industries. This will reduce your risk and increase the chances of earning profits.
– Follow your strategy:
You should have a clear strategy for investing in share market. You should decide how much money you want to invest, how long you want to stay invested, when you want to buy or sell a share, etc. You should stick to your strategy and avoid emotional decisions based on greed or fear.
Conclusion:
Investing in the share market can be rewarding way of making money if done properly. You need to understand what is share market, how it works, and how you can start investing in it. You also need to do your research and analysis before investing in any share. You need to invest wisely by following some basic rules.
I hope this blog helped you learn how to invest in the share market. If you have any questions or feedback, please leave them in the comments section below.
Thank you for reading!
About Author
