Everytime I used to read about the terms like Equity trading / speculative trading, shares/stocks, bonds/mutual funds, bull/bear I felt like ‘I’m interested but it’s not my cup of tea’. And I’m sure majority of Indians can relate to this thought too. So the obvious question that arises is – why? Why we Indians, inspite of having a world-class financial infrastructure & having one of the world’s highest household saving at 30%, still play in shallow waters when we can play in the deep oceans.
One can get varies answers to this obvious question :
- Lack of proper knowledge of stock market
- Lack of large amount of money
- Fear of taking Risk, & of course
- Major stereotyping that those who play in stocks are Genius!
However, if we put our emotions aside for a moment & think rationally then we can clearly see through that all these reasons are negligible . Let me show this through some facts.
In this globalized world, not having knowledge of anything is pretty much more sort of a excuse. Knowledge of financial markets (no matter how big it sounds) can be easily acquired through reading/watching financial news and various books on investing. Also starting a paper trading account before using actual money is a good move. I would recommend reading the Intelligent Investor by Benjamin Graham. We can also easily find a platform for paper trading by googling it. I usedand made a 54% return my first year, so that really got me excited to start with real money.
The next presumption is need of large crunch of funds. Well certainly there is no minimum limit to what amount one can invest. We can even buy share of some firms say of $1. But the only catch here is the brokerage charge. We need to pay brokerage charge on each single transaction. So if we invest very little amount say as less as $1, then most probably we will end up in paying more then you get the profit from share speculations. So anything between 3k-4k is a good amount to start. Also it is better to invest in blue chip stock with price range RS 4OO to Rs 480 per stock and sell at 10% profit within 3 months.
Now if you thinks share market is ‘only the genius’ play‘, then plz help yourself to so many live examples online depicting laymen turning into big bulls. See there is one very basic rule that all these successful traders followed : ‘Research, stay update, make your trading plan, & never let your emotions (Fear & Greed) drive your actions‘.
Bottom line is –‘It doesn’t take Einstein or Bill Gates to start investing. What it all takes is your interest and consistent effort‘.
Happy Trading 🙂