For ages currently share markets have been most popular and discussed ways of Investment for Indians. But why is it that a lot of people are unsuccessful with market investments and recommendation against it? It is because they build these common mistakes while investing in share markets.
Trading on share markets are not for everyone while this saying holds right, however, it doesn’t mean that it is not to be invested in on the entire Speculating on share markets and their market trends is a very bad idea and each investor must avoid doing from it. If you are an ‘investor’ in the stock market it is most likely that it is not your full-time business, and probability are you will be carried away with go up and fall down in the stock markets depend upon market trend. Stock market trend very reason the way of mutual fund is often suggested for equity market investments. However if one fails to obtain a taste of direct equity market investment, then please forward your personal and your finance’s reason, Remember the following 11 major mistakes to avoid when investing in stock market in India:
1. Market Timing:
Initially thing to remember is that there is no such thing as the market timing. Stock market now a day doesn’t follow a trend that a common investor can understand or grasp. Generally yes, you can say that due a international event or certain political the markets may move up or fall down, but Different from that one cannot be definite about how much and when the markets will go up and fall down. There will be ‘analysis’ ‘predictions’, ‘projections’, and what not but still you as a common investor should not think about the market timing. Instead if you want to begin investing, begin small, go for a technically and fundamentally strong company like Trifid Research he will provide Stock Tips, Option Tips, Commodity Tips, and Nifty Tips etc that has performed always well in the markets for a short term and long term invest in it and then take it from there.
2. Following Tips:
If you get tips and blindly put your money in it, be ready for a few boorish shocks down the way. Yes, you may increase at a few points but Stock Tips, Option Tips, Commodity Tips, and Nifty Tips etc can be disastrous and there are more cases of people losing money than gaining by following tips. As mentioned previous to, study the latest market trend of the company and its base along with its performance on the market even when there was a fall down trend. If the slide is very less than most other companies or the performance consistent basis, then you can invest in their shares.
3. Borrowing for Investing:
Worst likely mistake to be ready for any investment and the most objectionable mistake to invest in shares, is borrowing money to invest. Some investment advisor, planner of financial will inform you that borrowing for investment is the bad thing to do. The markets returns you get will be denied by the interest you have to pay on your borrowings and in case you raising even a small loss that will consequence in you bearing a double loss, which is: interest on the borrowings + principal of repaying amount + bearing the losing on investment. I have seen people own falling in this trap and going deeper. A stock market trader once follows tips from his colleague and friend and since he did not have ‘sufficient’ amount of cash, he took a personal loan and invested in the ‘tip’ he received. The stock market crashed, he lost fully and then had to borrow from a closed friend, colleague or relative to refund the personal loan and bear the loss, thus going on a go up debt trap. Invest with what you have and gradually rise your investments.
4. Thinking you know it all:
The probability is you may have build excellent profits and since equity is known to provide maximum returns when the market movements are good, you may put to gain a nice amount of returns on investment. If you have been lucky to grow in the markets by making a few random investments, it is great news for you. However, don’t think that now on that basis you know it all. Share markets are very difficult and while nothing is impossible, better understanding the market trend will take valued amount of time, basics of knowledge, dedication and even then they will remain unpredictable. Largest of market Financial Analysts and Gurus who appear in clever result on your news channel or television daily, giving their ‘expert opinions’ have fallen down on their faces in the latest market situations. So don’t get overconfident and think you know it the entire. Learn the basics of stock market and invest systematically. If you are not enough time to give you the basic Knowledge of stock market and latest market trend better to contact best advisory frame I am giving best stock market advisory company he will provide Stock Tips, Option Tips, Commodity Tips, and Nifty Tips best accuracy level.
5. Holding onto useless shares:
If you are investing in shares for a long time or a short time, you maybe know that final prices average out and you may be able to get better returns on your investment amount in direct equity market. However, these can consequence in holding onto to useless shares; most of trader followed common mistake while investing in stock markets. A useful example is of a well-known Indian company that came up with an IPO for its raid into the power sector and it opened at about 400 Rs in 2008, and many people purchased the shares at that price as the company was ‘Large to fail’ and in the long run it was definite to give huge returns. However, today after almost 9 years that share price suffers at Rs. 65- 70 Rs. In such type of cases the averaging will not work out. It is a superior idea to book your loss and get free of such useless that have not risen even after a long time or else it keeps eating keep away the profits of your market investment portfolio.
6. Thinking short term:
Trading of equity is the most excellent asset class to invest in, which will provide you inflation beating returns in the “LONG RUN”. Keep in mind this statement. LONG RUN is being the keyword. Invest in short term gains may come once in a while but probability of you losing out are also maximized. As described previous to, if you are a common stock market investor, whose main profession is not dealing in stock markets or shares trading seem for longer term trading. Speculation and Short term trading should be left for the ‘market experts’ or full time share traders and Advisory or Broker like Trifid Research he will provide Stock Tips, Option Tips, Commodity Tips, and Nifty Tips and investment big fishes. Long term stock market investment will give you better returns and hence the investment mistake of thinking short term should be avoided at the entire costs.
7. Not being Patient:
Now similar to thinking short term is a stock market investment mistake, being restless is another investment mistake. If you are today and tomorrow invested the market crashed, don’t peruse of liquidating it. Be patient. Things you will work in the long run. If the company you invested in is good for fundamentally and has a proven consistent record in the past few years, more probability are the prices will get better and you will get excellent returns along the way. Be patient. Keep in mind Investments are not 100 meter races of sprint, they are marathons.
If you are seated in front of trading software tool don’t panic. Markets will fall down, markets will go up, markets will become stable, and they will right themselves every now and then. This occurs and will occurs, so wait invested, if the shares you hold are good for fundamentally and the proven over the past, you will get superior returns. Don’t panic and smash your investment habit.
9. Blindly following “Market Guru and Market Analysts”:
Keep in mind the so-called market Guru and market experts appearing on your screens are also persons and they do not run the markets, however effective people they may be. Their assumptions and analysis and predictions may go wrong. As mentioned previous to, markets are very difficult and are affected by many foreign and domestic factors which at a few points are beyond anyone’s control. So do your personal research and don’t blindly follow what your favorite business TV channel told you.
10. Purchasing because a share is low and selling because high:
If you believe a share is attractive to purchase now because it is priced lower and will therefore go up in price more than the years, then this is a very big mistake. The share can be low due to many factors and may also be a case where the share has fallen down sharply from a higher price and is the actual valuation and won’t much gain. Don’t make this mistake while investing in shares to now go for a share now because it is priced lower. Alike, don’t think that just because they share priced is the maximum it will not much gain. Again it totally depends on the performance, stock market trend and fundamentals of the company and past record. Just like you ‘shouldn’t judge a book by the cover’, you should not be judging a biased of share on its price.
11. Put your money in equity market:
Finally but not the least, don’t put all the money you have for investment in share market. Diversify. Keep a balanced portfolio account with an excellent mixture of debt and equity as well as other types of investment ways like FD, Recurring Deposits, Mutual Funds, and PPF etc. If markets fall down, you will lose the entire you have if you don’t diversify. In worse scenarios when markets are bad your borrow investments will at least give you a few pillows. So DO NOT makes this stock market investment mistake of putting the entire your funds into the stock markets I hope they will provide unbelievable returns. Don’t be insatiable.
Investing in the stock market is not a bad place many you may think. Nor is it a place only for a chosen few. It is a way of investment just like any other; however you should be careful and ready to face a few losses and stick to your investments in a regular systematic way and avoid these mistakes in investing in the stock market. Also if you feel that direct equity investment is not for you, you can refer our guide to Stock Tips, Option Tips, Commodity Tips, and Nifty Tips etc. Here and how to invest in the stock market here for more information. However if you feel better more comfortable you can always get started in Share Market Investments by referring to our free guide.