Welcome, this post is going to be on “how to make money in share market ?” if you are reading this post then you must be searched some other questions like–
how to make money online in india ?
how to make money in share market ?
how to make money in stocks ?
These are the few questions which, is mostly searched by a group of common people who want to make money in quick way, and definitely Stock market is a great way of doing that. So before moving further let me focus you on some very- very important points, that is psychology behind a trader and investor.
if you have come here then you must be passionate about stock market.
My first question for you would be , why you come here ? off course , your answer would be to earn good profit, but there are lots of other businesses where you can earn, so why stock market ?
My second question would be who inspired you to come in stock market or simply i can ask you how did you know about stock market ?
In your mind you will think these are boring questions why i am asking you, but these are very – very important questions, before starting your journey , asks these questions to you, if you satisfied with your answer then move ahead.
So let me clarify these things, if you have watched any video or heard from someone where a trader made something like thousands of rupees in intraday then that video must be inspiring you, you will definitely think it’s so easy to earn money in stock market , if that guy can make money in few minutes then why not me ? i can also make money.
But you don’t know to earn that money that guy have worked hard several years , so its not so easy to earn money in stock market, if you think you will earn money overnight and will become millionaire in few months.
Then my suggestion would be for you, leave it immediately otherwise you will become “roadpati from crorepati” (like a beggar). I have already posted an article of a person who lost all his wealth in Indian stock market with the title “ The Story of a Young Trader who lose almost 15 Lakhs “
Now we come to our main point , do we not enter into stock market ? my answer would be “no ! i didn’t say that” but definitely yes if you come here with the mindset to become millionaire in few days or months.
But wait—– if you have come here with clear mindset , discipline and patience and want to give your 200% not 100% effort to learn , understand things in place of direct jumping in to stock market, then you can start your journey with Indian stock market or any other stock market.
Its little bit similar to other businesses where you get a small and regular profit if all things goes well. if we take an example of other business, suppose you open a small departmental store, there you work daily basis and earn some profit at the end if your total capital is one lakh (100K) then might be you will earn maximum 200-500 rupees on an average that is about 0.20 %- 0.50% and you will be satisfied with it.
Then how you can think to earn 10% or 20% or more on that capital in stock market , i don’t say this is not possible but that should be your day, it’s not always possible.
If you have worked hard and now you are efficient to earn profit and make money on an average 0.50% profit on your capital on regular basis as a trader , then in a month with 20 trading session it would be around 10%, so in a year it goes 120%. If we take it as .100% then in one year you are making your capital to double, that is the power of stock market, that makes it different from other businesses, on other side bank give you around 8% return on your capital.
Now if you are fully prepare and come here with clear mindset then we will move ahead.
So in this part again i have few questions .. Do you want to be an Investor or a Trader ? Because initially most of the people come here to invest but later they start trading.
Different person have different view on it, if you want to create wealth in long period of time then investment is the best option for you and it is 100% correct;
The reason behind it, here we get a very powerful concept ” The Power of Compounding” , according to great scientist Einstien “Compounding is the 8th wonder of the World”, so if you plan to invest a certain amount of money on regular basis for long time then after a long period of time (almost 20+ years) you can check the affect of compounding on your investment, if will convert in to a huge amount that you cannot believe.
If you are planning about investment, here a term comes SIP “Systematic Investment Planning” means you choose a plan to invest on regular basis, almost all the fund manager and capital market experts suggest you to invest in stock market via SIP, this is because you remain safe during stock market volatility or ups and downs.
Now we come to our second major part that is “Trading”, this section will more attracts you specially to newbie, simply the reason is here the probability is very high to double or triple your capital in very short period of time, but we should not forget about loss, if you could get double or triple your capital then you could also lose all your capital in very short period of time,
Here almost 90 to 95% people lose their money , only 5-10% get profit, that’s why here failure rate is very high then get success. Here only those people earn who are skilled , experienced and very – very smart, they try to analyze the market, try to find the market trend or direction and then enter at certain level and exit at certain level, they know very well what should be their loss, and what should be their target, they mostly follow money management and risk to reward ratio, including these things their major arsenal is chart reading , they are efficient in chart reading and data analyzing, so these are major things to be a good trader. We will cover these topics later in upcoming articles. That’s the end of this article “how to make money in share market”. To know the basics of share market you can read the post Share market basics for beginners