How to start investing in stock markets

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When it comes to investing money, people go for fixed deposit as it is giving guaranteed fixed return annually.There are a lot of instruments in which you can invest in real estate, gold, commodities etc.

But according to me, the stock market is the mother of all investments because it can give you unlimited return.

Lots of people have made their fortune like Warren Buffet, Rakesh Jhunjhunwala etc, if you want to know most of the money in the world goes into the stock markets which makes it full of liquidity.

I will tell you some tips you need to know before investing,

1)The first rule of investment is “Invest only when you can afford to lose”.You don’t have to take a loan to invest.

You have to first cover your expenses and the money which is left can be used for investment.

2)Don’t be greedy

It is a very traditional saying that you don’t have to be greedy in anything because if you do so then there is a probability that you will earn handsome money and also you will lose all your money so let’s when do people become greedy?people become greedy when they see that they are making huge profits in that asset and also when people lose money and they think that they will recover all their losses by investing more money and they become greedy so basically I am saying that you have to know the depth of the water before jumping so you have to do proper analysis and you have to know that company which you are going to invest in so that it does not become gambling.

3)Don’t let emotions come from investing.

Let me tell you a is very interesting story about my trading incident when I was very new at investing where I bought 100 shares of a company because I know that company is going to do well as I did fundamental analysis before investing but on the next day after I had bought shares of that company, share price was reduced to 6 % against the last traded price because at that day the results of that company was going to come and the price becomes volatile so when I see that the price is going down I lose all my comfort prices going and I sold all that shares and get the loss, next day the price did go up so what we learn from that incident is if you are confident about any company, don’t panic.
Let me tell you another incident of mine there was a company which I was watching, again and again, every day when the price was going up and I thought this is the time that I have to enter before it’s too late so I bought that share and price goes down because the reason of that is that those shares were going up because of operators and it was just a Panic buy because there was a good news rumour in that company and that was a hoax and on the other hand that company was not also fundamentally good but the price was going up.
So here we learn from the above two incidents that you have to do proper analysis and proper research before entering into any type of financial asset.
Don’t let emotions fool you.

Read: Know why stock prices are different on NSE and BSE

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Saifullah Khan

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