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How To Start Investing In Stock Market

If you are a new investor and are looking for the steps to start investing in the stock market you are the right place. The steps to help you start investing are:

·         Get a PAN Card:

For entering into any financial  transaction in India, the basic requirement is to have a PAN or Permanent Account Number. This is a set of unique code having 10 alpha-numeric characters. This is assigned to each and every individual by the Tax authority of India. This is required for opening account in a bank, to fill Income Tax return, invest, etc.

·         Get a Broker:

Stock market is open for investors, but not everyone and anyone is allowed to start exchanging i.e. buying or sell of stocks or shares like buying and selling of any other commodity. These transactions and exchange can be done by only authorized individuals, who are known as brokers. They are registered under SEBI (Securities and Exchange Board  of India. The brokers are of  two types among whom you can choose. One is  a traditional full-service broker who charge high brokerage but are have better knowledge and expertise. While the other type brokers who have Lowest brokerage but they only provide a platform for exchange and no advice. et a broker, they can be individuals you know and are reliable, or you can approach various companies that are licensed to trade and deal in securities in the markets.

·         Get a Trading Account:

As you find a broker, he/she will ask you about your Demat account. For doing any investment in stock market you must have a Trading and demat account. This is actually a account which keeps or holds the stocks or shares. As these shares and stocks cannot be held physically so they require a Demat account to store them in the dematerialized state. These accounts store the stocks and shares in your name.

For buying and selling of the shares need a trading account. This account acts like a bridge or intermediate to facilitate the process of buying and selling. The broker takes care of these accounts.

·         Buying and Selling:

To do the exchange, i.e., buying and selling of stock and shares, you must inform the broker about your choice of investment and the quantity, which you want to buy and what us the price you are ready to invest.   If there is a online broker, there are  customer care numbers as well which can be used to place orders. As soon as the price of the share reaches your required price, transaction in done. Same is done while selling.  The order of selling is proceeded only when order reaches that price as required. The broker keeps you informed about all these activities.

Mistakes to avoid

As you start investing may be you start gaining good, but don’t let this get carried away. Stock market is a tricky place, you cannot be assured of its conditions. As no time is taken in gaining money, loosing the money is much easier and will too take no time.  So keep in mind these points :

  • Do not put too much money. Always invest what is surplus.
  • Keep your portfolio diversified.
  • Choose brokers who charge Lowest brokerage
  • Stay slow, don’t rush.
  • Do not loose hope easily, even if you suffer loss.
  • Do not get too overwhelmed with profits.

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