Posted By : Kishore B.S
Money! Everybody wants it. Probably don’t know how much they want, but they want it bad enough and this thirst never goes away.
So what is the mantra for quenching this thirst. Perhaps nothing. But there is obviously a way to multiply whatever you got in your own pocket and investing in stock market is a nice way to start with.
It is a belief of many that investment is a complicated process, only rich or people with experience can dip into stock markets. Well, most of this belief is not true. Obviously there are ups and down and it has risky way to go along with, but it certainly has nothing to do with opulent people and age.
Person with small savings should feel no sweat to invest, as the returns from the same can take care of his/her short term financial goals. Remember, you are never too young to invest your savings. Earlier you start with it, you’ll end up more rich than those who wait for the right age.
So with some guts, positive psychology and enough savings, put away your money as investments. For the beginners, it is discreet to go with a proper strategy. Having the basic knowledge of what stock market, shares, dividends etc. is all you need to put a base for your investments.
There is vast array of investment options available and you should consider how and where will you invest. Maintain a proper check on the share prices. But stock market only sets the price of a share. To find its value you have to do a careful analysis of the company’s financial statements and important ratios. Go through the financial statements for at least the past five years (advisably ten years is better), annual reports of the same company. This might be a time consuming process but that is how you can reach for the fruit.
But checking out only what company has in its pockets is just the half way to the basic step. Taking half measures in its basic step is not at all preferable when a lot of risk is involved. You certainly need to go through what the peers are doing, what is particular sector scenario and how is market behaving.
Have you ever bought anything without comparing , be it a cell phone, car, house or anything. You always want to buy that is best and obviously in trend, among all the options in hand. Same goes for the shares. Your investment research would be incomplete without the proper comparison of the company with its peers.
Tapping to 52 week low and high lists (visit http://www.nseindia.com for updates), maintaining your watch list and making a margin of safety are few other concerns which should be taken care of, if you want to be a bang-up investor.
In addition, tag around with investment advisors as they can provide a helping hand and you will eventually get an understanding of taking appropriate investment decisions.
Stock Market Institute, Bangalore.