Planning to invest in the stock market is not sufficient. You need an effective action plan. How many times do you hear stock market investing is risky? There are hundreds of stories about ‘investors making millions of dollars in stocks’, but surely, you miss out many untold stories that ‘how people went bankrupt’ while investing their hard-earn money in the stock market.
But why do people lose money in stocks? Is it so complicated for investors to make money? Yes! Making money in the stocks market is art. You can master the art if you strictly follow the dos and don’ts of investing in the stock market. Lack of stock market education is the problem of 90% of Indian stock market investors.
For instance, the core investment strategy in stocks market is to ‘not speculate’, but investors do not speculate to invest in after deep research. However, most investors make wager investment in stocks and bet that the share price will go high in forthcoming days without any prior analysis.
The post discusses the dos and don’ts of stock market investing for beginners. Let’s get into the topic:
Do’s of stock market investing
Here are 3 dos of stock market investing that every newbie should follow:
1. Join a course
Joining a stock market course is the most relevant thing you might have heard every time. If you desire to make money from investing, then begin to learn the stock market course. It isn’t mean that you need to join a full-time program. Today, there are several online stock market courses available. You just need access to high-speed internet and enroll in the best e-learning platform.
2. Take Small Steps
Let’s take a scenario here. Imagine if you desire to learn swimming, you won’t jump in 12ft deep swimming pool. Right? Likewise when beginning to invest in the stock market, it always advisable to start with small. Make a small investment in the market and gradually increase on the go. The practice will boost your confidence and enhance knowledge to investment.
READ MORE: Best Way to Invest in Chinese Currency
3. Start Early
We cannot put more emphasis on the importance of getting started early with finances. When starting early the time is in your favor. Moreover, it adds leverage to recover even if you make losses during the early time during the investment journey.
Don’t of Stock Market
Traders violate every rule in the book. Here are 3 rules you should never break as an investor.
1. Stock Market Equates to Gambling
Investing in the stock market is nothing less than gambling. Gambling is a state when an investor purchases a random stock and expects it to give higher returns. Don’t let the wave of stock market volatility reach your brain. Always make to inform investment decisions. The practice to invest smartly comes with education.
2. Relinquish Unrealistic Expectations
There is no doubt that many investors made a 400-600% return on a single investment. However, the dark reality is the news gets circulate in the market. Always set realistic expectations and do not assume a level of control that does not exist. Setting up goals that do not exist will hold you back. This means you use more of the brain than brainpower to solve a trade.
3. Don’t Screw Up Emotionally
Understand big risks do not pay off. Emotional discipline will help you make better choices. Don’t let your emotions make your decisions. Human psychology is complex. While investing in the stock market, consider both internal and external actors. No matter how much biased you are too a company stock, of it doesn’t seem profitable then do not invest. Thus, do not get an emotional decision if there is no bright future potential.
The post covers the fundamental stock market do’s and don’ts for newbies. Furthermore, this is a basic guide and not a handbook. We advise you to consult a stock market expert or attend a share market course before start investing on your own.