Well off late I started share trading from November, 07. Here I would like to share my experience for all those novice people who want to know the basics. I am not an expert and I am still in the process of learning lot of things so don’t take my words blindly.
These all are my personal views and thoughts which may differ person to person..
What you need to get started?
- Capital – 20 to 30 thousand to start with (it depends on your appetite)
- Guts – share trading is not for faint hearted people
- Vision – ability to think and analyze
- Patience – power to go through ups and downs
- Honesty – stick to your original game plan
- Demat and Online trading account – off course it’s needed.
- Your need for investment – First of all you need to know that why you want to invest, what’s your need and for what time frame you want to invest. You should be clear about these things like is it for short term or for long term etc.
- Have a clear target like how much you want to earn – You should have a clear plan before buying the stock like what kind of profits you are looking for and it should be realistic. For example you may except to earn 50% in 3 months from that particular stock.
- Gather information about the company in which you want to invest – Do the small research on the company’s past and present performance. Go through their website and read recent news about the company and if you feel positive about it then only buy that stock.
- Get the information about the sector to which that company belongs – Yes it’s very important to know about the sector that company belongs. If the sector itself is performing badly then no point in expecting a good return from the company. For example nowadays the whole IT sector is down so the all IT companies shares are down and nobody is interested in them.
- Check the market and economy conditions – You should also see the market conditions before buying. You should look whether the market is over valued or is there any negative trend etc.
- Moneycontrol.com – Great site to learn about market and to get any sort of information about any stock or any sector. Do create a user id for yourself and you can also track your investment in their portfolio tools free of cost.
- Pehla Kadam (First step) – This provides a basic tutorial about share market and related topics. Very basic and very nicely written. A must read before you kick off.
- And do read The Economics Times regularly and watch CNBC TV18 or NDTV profit.
Some of the good sectors to invest in (at present)…
- Construction & Contracting
- Infrastructure
- Power generation and distribution
- Financial and Banks
- Iron and Steel
- Oil and gas
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