Invest in Stocks

Stocks in the share market can be classified into different groups based on various criteria of classification. Here are four ways in which stocks can be classified.

• Based on the priority and voting rights
  Stocks in this category can be equity shares or preference shares.
• Based on market capitalization
  Stocks in this category can be large-cap, mid-cap or small-cap stocks.
• Based on the investment approach
  Stocks in this category can be growth or dividend stocks.
• Based on their relationship to the economy
  Stocks in this category can be defensive or cyclical.

The stock market is primarily considered a high risk investment option. This is because it is challenging, at the very least, to predict the price movement of stocks precisely. So,
investments in the stock market are considered to be riskier than most other investment
options.

However, despite the relatively higher levels of risk involved, it can be safe to invest in the stock market if your investment decisions are backed by adequate research and due diligence. This is especially true if you invest consistently in the stock market over the long term, since that would allow you to tide over the effects of short-term price changes.

There are plenty of free online stock market courses on the internet today. You can even enroll in many of them free of charge and learn about the workings of the share market.
Alternatively, you can also watch a few videos each day on free platforms such as YouTube to gain more knowledge about the stock market.

Once you’ve gained enough theoretical knowledge, you can even try your hand at practicing stock trading using virtual trading applications. This way, you can gain some much-needed practical knowledge on how trading actually works before you seriously begin stock trading.

Investors generally tend to use the words stocks and shares interchangeably. While this is not wrong per se, there is a small difference between the meanings of these two words. Shares essentially represent a portion of ownership in a company. For instance, when you hold 1 share out of 100 shares of a company, you essentially enjoy 1/100th of the company’s ownership.

The term ‘stocks,’ on the other hand, is used to refer to a collection of shares in one or more companies. For instance, if you hold 100 shares of a company, you hold the stock of the company. As you can see, the difference between the two words is quite minor. However, for all intents and purposes, the terms stocks and shares are used in place of each other today.

Stocks primarily make you money through capital appreciation. This is simply a rise in the market value of an investment or an asset. So, if the share price of a company rises after you’ve bought it, that’s an example of capital appreciation. You can earn the benefit of capital appreciation by selling your stocks for a price that is higher than your purchase price.For instance, let’s say that you purchase 1 share of a company for ₹100. And after a certain period, the share price rises to ₹150. This is a clear-cut example of capital appreciation. You can cash in on the gains of ₹ 50 by selling your holdings.

That said, capital appreciation is far from the only way in which you can gain financial benefits from the stock market. Stocks of certain companies also give you the advantage of dividend payments. Dividends are simply a share of the company’s profits that are distributed to the shareholders. These dividends are in addition to any capital appreciation that the stock may bring in over the long term.

You don’t always lose money if the price of the stock you invested in goes down. Although the stock may show up in red or in the negative on your online trading app, it is just an unrealized loss. You will only lose money if you sell your holdings when they are in red, for a share price that’s lower than your purchase price. This is because the loss is only realized upon sale.

So, you may choose to not sell the stock even if you find its share price going down. Instead, holding on to it even when its price is going down may be a good idea, since there may be a chance of the stock bouncing back up. This way, you can avoid suffering a loss even when stock prices go down.

Say you’ve decided to invest in a particular stock after extensive research and due diligence. Now, when you purchase the said stock from a stock exchange such as the BSE or the NSE, the amount of money that you pay for the stock will be sent to the trading account of the seller of the stock. This seller may be another individual or an entity, and not the company itself.

However, if you purchase a stock during an IPO, rather than from the BSE or the NSE, the amount that you pay for the stock will go towards the promoters of the company or the company making the issue.

Yes, you do. A demat account is an electronic account that allows you to store shares and other securities that you purchase from stock exchanges like NSE or the BSE in India. According to the regulations of the Securities Exchange Board of India (SEBI), a demat account is mandatory if you wish to buy or sell shares in the stock market. So, you need to have a demat account if you’re interested in buying stocks.

You can check out the Upstox web & mobile platforms for free and open an account only when you’re ready to place a trade. There’s no fee to use the trading software.

1. Sign up with your details name, email, phone number, city, and state.
2. Enter your PAN details
3. Complete registration payment
4. Verify your email
5. Submit essential documents
6. Upload an IPV Video
7. eSign
8. Start earning for every user you successfully refer and enjoy a share of the brokerage from each trade your referred user places.

You will need to have a Demat or Trading Account, your PAN card, and a bank account with the required funds to buy and sell the stocks.

To buy stocks in India online, you will need to log in to your online brokerage account, search for the stocks you wish to buy, and place an order.

To open an online brokerage account, you will need to provide some personal information and complete the account opening process on the brokerage’s website. You may also need to provide proof of identity and residency.

You can fund your online brokerage account by transferring money from your bank account to the brokerage account. The brokerage will provide instructions on how to do this.

Your online brokerage account will provide you with access to real-time quotes, charts, and other information to help you keep track of your stock portfolio.

Yes, there may be fees and taxes associated with buying stocks online, such as brokerage fees, transaction fees, and capital gains tax. It is important to research and understand these costs before making any purchases.