Stock Market is a place for Investment. Stock market is the most sought after Investment in the world and India. There are many instances where people who invested only in thousands managed to make millions. The great software boom in India is a great example. People who Invested in Infosys became millionaires overnight. Remember the reverse happened too. Beginners must spend some time learning the basics of the stock market. You will be provided tutorials on stock market for beginners and also on how to join stock market.
What is a stock market, Beginners guide
Stock market or a Stock exchange is a place where stocks and derivatives of the companies are traded. The trade happens and are controlled by the stock exchanges. There are some important stock exchanges in the world. For Example NYSE, Nasdaq, London Stock Exchange, BSE, NSE, Euronext etc.
Stock Markets are the place for companies to raise money. Companies sell the ownership of the company in shares to be publicly traded and thus they raise money for expansion or improvement. Main benefit of an investor is also this feature liquidity. He can sell his securities immediately and make money easily compared to real estate or other assets.
Over years stock markets have re defined the economies of the country. A raising market is the main economic indicator of a country now a days.
How you make money with stock market.
There are many ways of making money with stock market. Let us begin by explaining the possibilities of making money for a beginner. You as a beginner would like to invest in shares to make money in the long term. Here you make yearly or every six moths dividends. You will be given a share of the profit every company makes. It will be proportionate to the shares you have in your possession. It is called dividend. There is another way of making money with shares and that is capital appreciation. Suppose you by a share for 100 USD. After an year it is valued in the market for 150 USD. The difference of 50 USD is what we call as capital appreciation.
Join Stock Market.
To begin investing on shares you are required to follow certain formalities. You must have a valid Income tax Permanent Account No PAN and you are required to open a d-mat Account. You are also required to have a valid bank account.
A d-mat account is an account very similar to a bank account. You can open a d-mat account at any banks that offers the service and also from stock brokers. In India almost all banks starting from Icici, HDFC, AXIS, Oriental Bank of Commerce, SBI have this facility. There are brokers who offer this service for free. A d-mat account is where your transactions are being recorded. Every buy and sell would be recorded in your d-mat account. It is very easy to open a d-mat account.
Once you have a d-mat account along with other required steps like bank account and PAN no you can instruct your broker to buy and sell the shares for you. A good idea for the beginners shall be to have a patient understanding broker who would sit along with you explaining the formalities an various methods of investment available for you.
A beginner must not go straight in to the day trading or short selling etc. You have to learn the basics of the market first. You can begin by selecting some good shares which have strong basics and performance. By performance we say how much dividend they issue ever year, how strong is their credit standing etc. There are some rating agencies that give ratings to the companies. You can also learn the performance and the capital appreciation of the share over years before you buy. Once you begin your investment you can learn the various other money making ideas on stock market one by one.
