Consistent reforms in the Indian stock market, particularly in the secondary market, have resulted in modern technology and online trading, transforming the stock exchange. In the face of current turmoil and pessimism, Indian capital markets are poised as a fast-growing emerging market economy.
The Indian stock market has undergone structural transformations over the years, and it now compares favourably with those in developed markets. The development of stock markets reflects the growth of the capital market. Positive indicators include a consistent 8-9 percent annual growth rate, a GDP of $11.04 trillion, rising foreign exchange reserves of over US$ 513 billion, and a thriving capital market with the popular ‘Sensex’ index surpassing the majestic 36,000 mark. The Indian stock markets are becoming a popular destination for foreign investors.
So, if you want to become a stock market expert and maximize your returns, the BSE Institute has a course for you. Please read on for more information.
Steps to becoming an expert investor
We are all aware that investing in equities is the key to accumulating long-term wealth and becoming wealthy. It is important to remember, however, that not all stocks are created equal. While mid- and small-caps have the potential to generate high returns, large caps provide portfolio stability. This is not to say that you should ignore any of these stocks.
As a result, it is critical that you benefit from the high growth offered by mid-and small-cap stocks while also enjoying the stability offered by large caps.
Be strict with your stop loss. It means that if you are losing money, you should cut your losses and exit the market. Similarly, if you are on a winning streak, putting a proper stop loss in place will protect your profits if the stock markets begin to fall.
Learn whenever you suffer a loss. We lose money in the market as a result of our errors. Find out what went wrong and make sure it doesn’t happen again.
Avoid greed. It is all too easy to invest in a bad stock simply because it is rising in value. You might be in a hurry to make some quick cash for a down payment on a home loan or a down payment on a new car about to hit the streets. However, be cautious and keep in mind that this price increase is the result of market manipulation rather than any genuine change in the company’s financial situation. Also, keep in mind that in order to reap the most benefits, you must remain invested in a good stock for the long term.
Avoid leveraging. Many people take out large loans from others in order to maximise their profits. Though this may work in some cases, it can also result in massive losses if the market cycle turns. This can cause financial and mental stress, as well as the destruction of family lives and, in extreme cases, suicide.
Don’t act if you are not sure which way the stock markets will move. In such cases, it is preferable to remain a spectator rather than participate in market activity.
Read a lot. There are numerous good books on investing available. Always keep your knowledge up to date. Follow the thoughts and opinions of respected investors such as Warren Buffet, Rakesh Jhunjhunwala, and others. It will broaden your knowledge and prepare you to deal with any market situation with ease.
Limit the number of stocks. Make sure your portfolio contains no more than 20 stocks. To protect your portfolio’s value, make sure these stocks are from companies that operate in a variety of industries.
Don’t use various investment strategies. If you are comfortable with the buy and hold strategy, apply it to all of your stocks. Otherwise, you may be perplexed about which strategy actually helps you make money.
Remain patient and disciplined, Whatever the market conditions If the markets are falling, don’t get out; instead, wait for the market to rise. Also, don’t keep investing in the stock just because it’s rising in value.
Choose stocks as per your risk profile instead of the returns they generate. Do not invest in small- and mid-cap stocks if you are not comfortable with their high volatility.