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How to Invest in Indian Stock Market

The stock market in India offers lucrative investment opportunities if you know how to get it right. Most investors make the mistake of pooling in a lot of money and avoid diversifying their portfolio. However, one of the most interesting things about investing in the Indian stock market is that you don’t need to spend a lot of money. For example, you can start a SIP with as little as INR 500 a month. Also, you need to have a demat and trading account to start investing in the stock market. While most securities require a demat account, some others might not.

The three basic steps to investing in the Indian stock market are –

  1.       Identifying your investment goals: It is crucial to first understand why you are investing in the stock market and what are your expectations. When it comes to the latter, be realistic. Every day won’t be the same and you have to be prepared for losses. Your goals can be long-term or short-term. It is preferable to have long-term investments because though you won’t get the returns immediately, you can expect stable ones. The same isn’t true for short-term investments which are easily affected by the market’s movements.


  1.       Setting aside funds for investments: The worst thing you can do with your hard-earned savings is to put all of it into the stock market – that is something even the most experienced investors don’t do. Keep some spare funds for investment purposes; it should be the money you don’t mind losing, in case things don’t work out in your favour. You can increase these funds marginally later but in your learning phase, only start with what you can spare.


  1.       Enriching your knowledge of the stock market: The internet is full of material you can use to know and understand the stock market. You can take the help of books, videos, podcasts or even get in touch with financial experts online. There are multiple trading and investment applications where you can browse all you need to know about the market. Every asset you invest in will be different but there is no shortage of material you can consume for knowledge. Even the best minds in the industry are always looking out for more information to enhance their skills.

One of the disadvantages in the stock market is the rumours based on which people make their investment decisions. If you are successful in avoiding this trap, then you’re ready for the stock market.

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