Investment in Stock Market

Hi friends,

Welcome to the world of investment in Stock Market. What do you mean by investment?? Usually people say, I have put some money in Stock Market for long term but they usually do intra day losses & then they go away from Stock Market... They create wrong impression in front of other investors who are willing to invest.

"Investment" in simple terms means, "Application of money for earning more money".

Major points to be noted while investing in Stock Market.

Time period : You are investing in stock market for short or long period... Identifying the period is more important before doing Investment. Here you will get the returns on your knowledge.
Portfolio Diversification : The investor should not do the investment only in one sector. Investor should make a model portfolio for his own & do the investment according to it. I have seen people investing in only one sector & one scrip.. they have lost their entire capital. We all remember the black Monday ie 21st Jan 2008. You are the Investor not a Trader.
Investment on Fundamental Basis : Knowledge is key to protection. The investor should do the investment on fundamental. Before investing in particular stock, you must do the full study of that company for e.g PE, EPS, Operating Margin, Net Income, expansion plans, networth etc. Your investment should not be news based. Warren Buffet is the only person who has earned in this stock market... the reason is he has done Systematic Investment, selected dividend yield companies... never done speculation.
Profit booking : Here the investor makes the mistake.. whenever you are doing investment, there should be some time period. No one can catch "TOPS & BOTTOMS" in stock market. Fix the target by yourself & take the decision accordingly. There is one phrase " Don't be Greedy" Book the profit & get out of the scrip. While doing the investment please follow the trend bcz " Trend is your friend"