NEWS AFFAIRS 7 : WHERE EVERY STORY HAS IT'S AFFAIR!
How to invest in share market in India ?
What is the Share / Stock Market?
The share or stock market is where people buy and sell shares, which represent ownership in a company.. It’s a place where these shares are traded, and you can buy or sell them through a formal marketplace.
Read more: What is Nifty 50 in Simplest Form
How to Start Investing in the Stock Market ?
Gather Personal Documents
Before you can start investing, you need to have some documents ready:
- PAN Card
- Aadhaar Card
- A cancelled cheque from your bank
- Proof of residence (a document that proves where you live, as accepted by your broker)
- Bank account statements
- Passport-size photographs
Open a Demat Account
A Demat account to hold your shares in electronic form. Think of it as a digital locker for your stocks. You can open one online or at a bank or financial institution.
How to open a Demat Account ? Online or Offline format 2024 Edition
Open a Trading Account
A Trading Account is where you buy and sell shares because you cannot buy or sell stocks directly on the BSE; you need a trading account to perform these transactions online.
You need both a Demat and a trading account to trade in the stock market. Some institutions offer both accounts together, or even a three-in-one account that includes your bank account.
Link Your Bank Account
You need to link your bank account to your trading account. This makes it easy to transfer money for buying shares and receive money when selling shares.
Read more: Who are High-Net-Worth Individuals ? Example , Criteria , Importance and More 2024 Edition
How to Invest ?
Investing in the Primary Market
This is when you buy shares directly from a company through an Initial Public Offering (IPO).
Read more: What is Investment Banking ? IPO, Examples, Services , levels and More 2024 Edition
Here’s how it works:
- Apply for the IPO using your bank’s online system.
- The amount you apply for is blocked in your bank account until shares are allotted.
- Once shares are allotted, the money is debited, and you get your shares.
- After that, you can trade these shares on the stock exchange.
Read more: Types of Stocks or Shares : Market Capitalisation, Ownership, Volatility and More 2024 Edition
Investing in the Secondary Market
This is where you buy and sell shares from other investors.
- Use your Demat and trading accounts to log in.
- Choose the shares you want to buy or sell.
- Make sure you have enough money in your account.
- Set the price at which you want to buy or sell.
- Wait for a buyer or seller to agree to your price.
- Complete the transaction by paying for the shares or receiving the money.
Investing in stocks is straightforward once you have the right tools and accounts set up. Make sure you understand your financial goals and investment horizon. Use available tools and expert advice to make informed decisions and manage risks.
