Simple do’s and don’ts while investing in the share market
The initial plunge of Investing in stock market is always a tough ride for new or amateur investors. It is advisable to take a lot of time before people feel comfortable with stock market investing. Though the core concept of investing in Share Markets is simple, there are a number of Do’s and Don’ts in the Stock Market that can be followed by the investors. Implementation of these strategies might help them generate profits.
The pro tip to the investors before starting investments is not to get tripped by the emotion, speculation and advice from others.
Basic formula to attain good profits is DO PRIDE!
What is PRIDE?
Practice: With the advancement of technology and Artificial Intelligence, there are several mobile and web applications that help you to make good virtual practice on the Stocks. Do it now with Angel Broking mobile application is powered by ARQ – the Hyper Intelligent Investment Engine.
Research: A famous proverb says- Think before you act! But, in investments it is popularly heard, “Research before you Invest”. Money doesn’t come easy! So, before you invest into Stock or Mutual fund or commodity trade, do market research that is worthy your hard-earned money.
Invest: Small or big doesn’t matters in investment. Money never generates. It compounds. Every small investment can take a good advantage of compounding from early stage. Invest on the companies that are prone for low market risk. Remember that low purchase value and high sale value cannot be expected always. Be wise.
Diversify: Diversification of investments is a surefire that reaps higher returns. However, diversification doesn’t mean that portfolio has number of investments. It means the number of types of investments are higher in a portfolio. Invest your bucks into various sectors that are no where related to each other. Never over invest and always have a strategy and budget for every sector.
Extra Attention: World is so small that every happening in any part of the globe impacts financial markets. Remember to review the portfolio every now and then. If you can’t review the portfolio, hire a financial adviser. If you feel you can’t afford an adviser for the fee, commissions, etc., then Stock Markets are not your cup of tea! If you are a novice, it is a fact according to Forbes that around 40 percent of the returns are sacrificed as fee.
What is TIE?
Time: You can never time the markets. Most of the investors try to time the market despite of the repeated warnings from financial planners. The process of catching the tops and bottoms is a myth and involves high risk of losing sweat and blood.
Initial profits: Initial profits make you get carried away. But avoid that and invest the accumulated sum wisely. Also, check the market intermediaries and credibility before investments.
Emotion: Either positive or negative emotion, is just a destruction to your investment. Never bring in the love, greed and fear towards any investment predicting the future value. Calculations based on data works! Emotion never creates wealth rather kills it. Seek guidance of an adviser but not any emotion.
Finally, common suggestion to any investor is play with surplus funds to avoid the risks in the volatile markets.
Rupavataram Naga Teja