Nobody likes to lose their money, But many say it is not ideal to just keep money in your bank account so you should at least invest it somewhere and one of the most profitable yet risky place to invest your money is the Share Market. While investing in share market may lead you to a huge profit or a big loss. Experts in this field will be able to predict such up’s and down’s But what about the New comers who have totally no idea regarding the share market, Well this article is for them. It will teach you what exactly is share market and almost all the basics related to it so let’s get started
WHAT IS SHARE MARKET?
Share Market is a system where shares of publicly traded companies are issued, Bought and sold. Traders trade & makes money when shares price goes up or down. Actually, now that I think of it, Gambling won’t be an appropriate word to describe this because here you may win some $A money or lose any $B money and it’s very rare where you lose all.
Basically Share market is an adversarial trading system. It’s mainly because when one investor buys any kind of security or his shares then other one must be willing to sell it. Which basically means one of them will suffer a profit and another one a loss.
WHAT MAKES THE PRICES OF SHARES CHANGE?
There are so many factors which determine the value of a particular stock or a share; some of these factors include natural calamities like earthquakes, statement of political persons and influence of other country and government rules and regulations and also depends onto supply and demand. The combination of all these factors will create a certain type of sentiment which can either be bullish or bearish and also a corresponding number of sellers and buyers. If buyers are more than sellers then the price will rise, If the sellers are more, then the price will fall.
WHY IS IT HARD TO PREDICT THE RISE AND FALL OF STOCKS?
Let’s just assume that certain stock prices are rising for some years Investors predict that due to some corrections the prices will drop but what they don’t know is the exact trigger of such events, Therefore few investors with with some cash and find right time to enter into market. These things produce a couple of questions how will you know when to enter into stock market? If you are already having some stocks, then how will you know when to sell these stocks and move out? if the share market was predictable it would have been easy to answer all of these questions but it’s not there are many factors to be considered.
WHEN TO BUY AND SELL?
This is one of the most important questions of all time; these are the two decisions that an investor has to make in order to make a profit. It is often best to invest when others are pessimistic and it is often best to sell when others are optimistic. When you are going to buy just remember the prospect of profit is higher if you buy it after its price has fallen not after its price has risen
To sum it up if you are a newbie in the stock market then you are going to be hitting lots of road bumps. Try to avoid “Hot tip” given by some unknown resources, Try to invest into a company which you would really like to own. Often times it is suggested that you should not put all of your money into one stock. It takes years of practice to be well versed in the share market so it is often times good to get advice from the people you trust.