If you are thinking to dive into the vast stock market, don’t miss to go through these Stock Trading Basics. A Stock Market Beginners Guide containing a set of simple yet useful investing basics to enhance your knowledge.
There are many people who are excited about investing their money in stocks. After all, the markets can be very lucrative and there is definitely money to be made. Just remember that the trading markets are somewhat different in India.
Before attempting to get started, investors or traders will need to take the time to familiarise themselves with the stock markets and different trading mechanisms in India. With this comprehensive Stock Trading Basics guide below, you’ll be able to do just that.
Stock Trading Basics for Beginners:
Finding A Broker:
First and foremost, traders need to understand that most trading on the Indian exchanges are done through brokers. Therefore, it is best to finding a good broker for beginners. Trading for beginners in India can be tough. You can make the process much easier on yourself by choosing a good broker. After all, a reliable broker will offer better commission fees and more trading tools.
You might even get access to a demo account, which can be used for experimental purposes. Be careful when choosing a broker or you’ll end up hitting yourself in the foot.
Know When To Trade?
You also need to understand that the markets are not open 24/7. This is usually only the case with FOREX markets. Therefore, you’ll need to know exactly when you can begin trading on the Indian exchanges.
There are two exchanges in India and they operate on the same schedule. The Bombay Stock Exchange and the National Stock Exchange are both open on Monday through Friday. They remain open from 9:55 AM to 3:30 PM. Remember that, this is Indian Standard Time. It is much different from the times that most are familiar with, but it won’t be a problem for Indian traders.
Know Who Can Invest?
It is also vital to realise that not everyone is allowed to invest on the Indian stock markets. India finally decided to allow outside investments in the 1990s. There are two types of foreign investments. One is foreign portfolio investment and the other is foreign direct investments. Most will fall into the FPI category. This includes investments in which the trader does not have any control over the operations or management of the business in question.
To make portfolio investments in India, outsiders will need to be registered as a foreign institution investor. They can also register as a sub-account for a registered FII.
As an Indian, this is something that you will not have to worry about.
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Stock Trading Basics: Why to Know?
The truth of the matter is that there are plenty of opportunities out there. Nevertheless, some are going to be better than others. Some experts concluded that it was better to invest in India than China. That was undoubtedly a bold statement. The experts claim that India can outscore China in terms of financial market development and that is why India is safer from a financial crisis. Experts cite this as the primary reason why India would make a better investment than China.
Of course, each investor is unique. They should analyse their own preferences before handing over their hard earned money.
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These easy to learn stock trading basics are just a small step towards a giant leap into the stock market world. You just need to be careful and analyse the market trends to reap maximum benefits.