Investing Guide 2021
For individuals who have never had experience in stock market investing, portfolio management may look like an uphill task. Considering the way the share market’s unpredictability and huge losses are publicized, it can very well make novice investors a tad bit wary about allowing lucrative stock investment ideas to prey on their hard-earned money.
Nonetheless, stock market investing is not as complex as it looks. In fact, with the help of the tips below, portfolio management and stock market investing will almost look like a cakewalk for you!
Tips for first-time stock market investing:
- Do the groundwork:
The first and most important step in portfolio management is to get your basics right. You must read about the stock market and acquaint yourself with terms like ‘thematic funds’, ‘brokerage’, ‘mutual fund investment’, and ‘exchange-traded fund’. These are words, crucial to stock market investing that you will regularly encounter during your investment journey.
You must also get a Demat account or a trading account with a stockbroker in place to help you purchase and sell securities. You can ask your bank to help you set up a Demat account or go through broking firms for the same.
- Determine your budget and risk exposure:
The next step for easy stock market investing is to zero down upon a budget that you are willing to invest every month. This budget is dependent upon your current income and financial goals. Risk exposure is the amount of risk that you’re willing to expose your investments to every month. Depending on that, you can then choose which kind of securities (equity, debt, mutual funds, ETFs) and sectors you should put your money in.
The third step to stock market investing is, actually putting in that money and purchasing an investment tool. These investment tools are of different kinds depending upon the kind of risk you’re willing to take.
Through your Demat account or stockbroker you can invest in the following kinds of securities:
- Mutual funds and thematic funds
- Debt funds
- G-secs or government securities
- Equity-linked instruments and shares, and
- Exchange-traded funds or ETFs
To help you decide where to invest your money, there are tons of resources available online. The key to making a wise decision here is to read and re-read. You can also take the help of broking firms here that apply the best quantitative research methods in providing insights on stock portfolios and tips on where to invest.
Additionally, you will also find a lot of resources contributed by acclaimed wealth managers and financial experts enlisting top stocks to invest in India from time to time. While these lists are purely indicative and subjective – they form a good guide to help you understand how the market forces function.
- Managing your portfolio:
While a portfolio manager does a brilliant job in overlooking your stock portfolios, there is some work that you have to do as well. You have to keep track of your investments and their performance in the market to ensure you don’t dip into heavy losses. Further, if you want to inculcate a savings habit but fail to understand the stock market well, you can also employ the systematic investment plan (SIP) and purchase mutual fund investments regularly.
In the systematic investment plan (SIP) mechanism, a set amount of money predetermined by you is debited from your account at regular intervals to purchase mutual funds on your behalf. This process is wholly voluntary and in the control of the investor.
- Discipline and patience:
Stock market investing is essentially a game of discipline and patience. If your objective behind investing is the fulfillment of financial goals, then you must ensure you’re following a disciplined approach to investing and making the monthly deposits. Further, if your objective is to make some profits out of the market fluctuations – you must inculcate an attitude of patience and learn to strike a deal at the right time. This you will learn eventually as you progress in your investment journey.
Stock market investing, though risky, is one of the most profitable activities that you can indulge in to build yourself a savings pool out of your earnings. To gain maximum returns though, it is highly suggested to do your research and due diligence. This need not always be required. For individuals who are too busy or unaware of the stock market – platforms like Stoxbox do the needful for you.
Stoxbox, a thematic investing platform, will carefully curate ready-made portfolios for you with a mix of stock investment ideas and long term investment stock to help make your investment decisions easier for you. These ready-made portfolios consist of scrips from top companies to invest in India and are best for investors looking for the best mutual fund investments and portfolio management services.
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