Introduction To Investing In Stock Market
For long term investments, equity shares derive maximum returns though investing in equity shares is perceived to carry a high level of risk. If you watch stock market moves carefully and regularly, you can minimize the losses as much as you can. One can however, invest in stock market in two ways:
Some companies make initial public offerings through newspapers against which one can subscribe for a prescribed number of shares.
one can buy stocks from stocks available and listed in the stock exchanges.
Before proceeding with any of the aforesaid steps, one should understand the working modalities of stock market and hence on should begin with business>>company>>shares. One should learn to select a stock post understanding the market, know about the company whose stocks are to be invested upon and the price of the same.
Some amount of internet research, reading through business journals will help learning these skills besides buying low and selling high meaning buying at lower price and selling at higher price when the market is in boom. Certain equities are at high risk with high returns and hence, decide the funds to be allocated to invest in stocks.
Regular monitoring and reviewing the equity investments is highly recommended and for this, one should get updated with the periodical financial performance reports besides updating the prevailing market prices on one’s portfolio worksheet every week , month and year will help to a great extent. Besides, one should also review the reasons previously identified while buying a stock and check their validity or if there have been significant changes in the past assumptions and expectations. Annual review of equity shares within the overall asset allocation and re-balance will help in deciding if the investment is paying through or if it can be disposed of and avoid any risk of losing the money to enable sail smoothly into your financial bright future.
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