Here’s Everything That A Beginner in Stock Market Trading Should Know

 

Millions of people try their luck at the market casino each year, some do get success in it but a major proportion of them fails. Do you know why? Because stock market trading is not about luck, it’s about strategy, the right technique, and of course, the right direction. This is what makes it important to learn stock market trading first.

Well, I’m not saying It’s nothing about luck, but it’s NOT JUST about luck. You need both; correct approach and luck. But I don’t think we can do anything about the luck part, but I can surely guide you through applying the correct approach, technique, and strategy. Let’s start with understanding the basics of stock market trading. 

Stock Market Basics

You must have heard of the NSE or BSE, these are exchanges on which the Stock Market is built. So the stocks are listed on a specific exchange, this brings the buyer and the seller together and this is when it becomes a stock market.

Talking about brokers, brokers are the person or institution that represents an individual trader, brokers often work online these days. So what the trader has to do is, simply place all their stock trades through brokers, and the broker will deal with the exchange on your behalf.

Well, that was just the basics, let’s have a deeper dive into this and understand the stock market as a whole and allow me to resolve your query of how to learn stock market trading for beginners.

An Insight About the Stock Market

Have you ever heard about the Market Index? I bet you have because whenever anyone talks about the market being up or down, they are actually talking about the major market indexes.

A Market Index is basically a basket of stocks, which either represents a specific sector of the market or the whole market.

Now, this can be a long way and there won’t be enough time to learn and explain this entire concept. Especially when you are all hyped about investing. Let’s have a look at how you can start with the money-making thing while you are on your way to learning stock market trading.

How To Make Money in the Stock Market?

Since you are a beginner let’s talk about the options you have on your plate, and being a beginner, it is utterly crucial for you to know all about the difference between stock trading basics and stock investment basics.

So there are two ways for you to make money, you can either be a stock investor or a stock trader. Let’s see what are those: 

Stock Investors

• Stock investors are basically those individuals who prefer to keep their money in the stock for a comparatively longer period of time, maybe even a year or more.
• In stock investments, the returns are compounded over a specific period of time only.
• In stock investments, since returns are compounded over a specific period of time only, the investors use fundamental analysis for it. So since your investments with the company grow over a longer span of time, investors look at the growth and the trajectory of the company.

Stock Traders

• Stock traders on the other hand are the ones who buy and sell within the same trading sessions.
• Here, people look for short and quick gains rather the longer ones.
• They often take the help of technical analysts to understand and learn which stock would be the right one to invest in. If you are more into stock trading, you will have to learn stock market trading from the very beginning to its technical indicators like momentum oscillators, charts, Bollinger bands, and many more.

But still, the question stays intact, How do you start trading or investing in stocks? Let’s find out.

How to Begin With Trading or Investing?

Well, first things first, you need to open a Demat and trading account first. However, most brokers these days provide you with Demat cum trading accounts. The main purposes of these trading accounts are the transactions; buying and selling and Demat account to keep stocks the same as you keep your money in a bank account.

But if you are a trader, you don’t want to hold shares. You really don’t need to open a Demat account as most of your transactions will take place within the same day only, so a trading account would be appropriate for it. Demat accounts are the ones where your shares are stored in electronic forms. It usually takes 2 working days for shares to get dematerialized and transferred to your account. And hence, after that, if you buy or sell your share it is debited or credited from your account.

Well, that’s not the only source to learn about the stock market and its trading strategies. There are a bunch of stock market courses for beginners that you must enroll in to get a better insight into all this and know how to invest with the correct approach.

But to sum up, what we can conclude is that you don’t need financial background or education to succeed in the market but you must go through a correct approach to start the trading journey and become a successful trader or investor. And the approach can be anything; starting with a beginner’s course, researching on your own, building strategies out of your creativity, or anything.