Five Basics You Should Definitely Know About The Stock Market

Five Basics You Should Definitely Know About The Stock Market

Know About The Stock Market

The effects of the pandemic have ingrained the idea of extra earning. Trading in India has witnessed extensive growth. As per the National Stock Exchange (NSE), approximately 14.3 million new investors got registered by the end of my March 2021. The online platform has boosted the reach of trading. The discouragement of the loss is quite prevalent in the new investors. So to avoid losses, invest time to understand the basics of online trading in India.

Here are five basics before you start online trading-

1. What is stock market?

The Stock Exchange is the online platform where the activities of buying, selling, and issuing shares of listed companies occur. Bombay Stock Exchange and National Stock Exchange are the oldest exchanges for online trading in India. Though there are other exchanges, too, National Stock Exchange and Bombay Stock Exchange are the dominant ones. 

2. What is online trading? 

Online trading in India means buying and selling shares via stock exchanges. To start trading online in India, you can find many online stock brokers. Open a Demat account online with a discount broker for free or minimal fees and start trading.

3. How to do share trading online?

Online stock market trading involves using a PC or mobile device with an Internet connection to buy or sell stocks. The process has minimal human interaction, which makes it more profitable than offline stock trading. 

Online trading sites in India provide analysis reports on every listed company. The report suggests if a stock is bullish or bearish. You select stock on the interface of the stockbroker, and the algorithm sends the request to the stock exchange. When the stock exchange approves your purchase, it is reflected in your trading account. Most of the stockbrokers online provide free trading accounts or charge minimal opening account fees.

4. Choose your investment wisely

Analysis for online trading in India is easy as every online stock broker provides technical charts. While avid traders use technical analysis, new investors can use fundamental analysis efficiently. Before investing, look for ROE, PE, and other ratios of the company. Before investing look for ROE, PE, and other ratios of the company. These ratios are given online. Also, follow the news. Favorable news like foreign investment, potential mergers, or expansion plans can result in the rise of price. Similarly, unfavorable news can result in declined stock prices. 

5. Do not be apprehended because of the fluctuations 

The price of the shares fluctuates every minute. As the economics of supply and demand also applies to the stock market and other reasons like news, earnings of the company impact the price of the shares.

6. Best time to buy and sell 

The biggest dilemma is the best time to buy or sell. Ask questions when the price falls, what can be the reason? Usually, when the market is down, the prices fall. This is a downtrend. Buy shares in this phase. As per the economics, after the fall, there is a boom. So, take advantage of the pessimism. The right time to sell the shares is when the share price is at its peak or its upper circuit. When the price of a share touches its upper circuit, it falls dramatically.

If you are an investor or keen on investing or want to start online trading, open a trading account online with any registered online stock broker and go through the basics of online trading in India. Gather more and more information about the Indian stock market and its function. Instead of fearing price fluctuation, choose your investment wisely and find the best time to buy and sell the shares.

Also read:- Why Is The New Generation Moving Towards The Share Market?

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