How to start investing in Stock Market – for beginners

One fine evening I got a call from my sis she wanted to know about investing in shares, basically she wanted to know how to start investing in shares. Same day after two hours I got a call again, this time it was my school friend (a Chartered Accountant by profession) he wanted to invest in some shares whose price had fallen on that day but again problem was the same “Bro how to start?” To be honest second call was the reason to start this blog and here I am with my new blog ___

“How to start investing in Stock Market – for beginners”

Before starting you should be very clear that why you want to invest in shares, and if you have the answer (Reader’s mind – “Of course earning good returns dude”) then how much risk appetite you have.

(A gentle reminder if you are too afraid of loss or you can’t take risk better start investing in Fixed Deposit and PPF)

So where were we yes, now first thing is clear that we all are here because we want good returns because other savings scheme does not provide good returns and we want to utilize our idle savings (Reminder again: point to note idle OK !!!!!).

(Reader’s mind :  Godddddd When will you arrive at the main topic)

Ok Ok now the answer to the main question for investing basically three accounts are needed :

a) Savings                                              b) Demat                                        c) Trading

a) Savings Account – Simple Bank account from which money is withdrawn or deposited for trading.

b) Demat – It is the account in which share records are maintained, in simple words it is like a box where you keep your shares paper and all which you own. But it works on a concept of First in First out. (Reader’s mind : What did that mean). It simply means if you have purchased same shares on two different dates  one purchased earlier will be sold earlier.

c) Trading : Long Long ago…. Hellooo not that long but in 80s sharemarket was just like a fishmarket yes and outcry system was there, means traders use to come and bid by shouting, this system is now replaced by trading account where traders (in future You) make bid through their trading account.

So these three accounts are needed for investing but one more very important person is there ‘Broker’. You can’t directly trade in the market, for trading a broker is required who acts as an agent between exchange (market) and you, of course he is not doing the charity here, he charges for his services. In fact I think “Brokers” are the real heroes of this game because whether shareholders loose or gain they earn definitely through brokerage.

So now all you prospective investors, all you have to do is contact the brokers (Example : ICICI direct, Sharekhan, Religare etc {Disclaimer : I am not endorsing anybody here its completely your choice}) who will be opening your accounts, But don’t forget to compare their brokerages.

That’s all and yes don’t forget to comment and ask any queries.