Myths and facts about stock trading that every new trader and investor should know

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Everyone is a little skeptical about investing in the stock market for the first time. It is no longer a secret, however, that stock market investments can help people increase their wealth exponentially if done right. Out of a population of 1.3 billion, the number of people investing in the stock market is only around 18 million. There are also several facts about the stock market that most people don’t know. As a result, many potential investors have been blinded by the myths and missed out on a great opportunity to improve their finances.

Common myths that must be broken

Trading is all about making money fast: This is undeniably one of the most common myths that most potential investors fall prey to. Most people think that stock marketing is all about gambling. Since most people think that investors have little knowledge on the subject, they consider stock trading to be all about making a quick buck. . However, anyone who observes how the stock markets work closely will understand that making money here takes effort, knowledge, and a lot of time.

Investors need a huge amount of capital to make money in the market: Another common myth that discourages many new traders from engaging in stock market activity is that people can only make a lot of money if they invest a lot of money. It may come as a surprise, but you can start investing in the stock market with as little as 1500 rupees.

The stock market is all about suffering losses: Before you consider investing in the stock market, you should know that the stock markets are quite risky and unpredictable. However, if investors execute a well-planned investment and apply the right strategies, the chances of incurring losses are reduced to zero. Be a little patient, educate yourself on the current market scenario, and rest assured you are making some money home.

Stock market facts you need to know

Psychology plays a major role in determining stock market behavior: Psychology is a huge part of stock investing. If investors have a good understanding of how market psychology works and how it affects behavior, then they can use it to their advantage.

The psychology of an investor can determine whether or not he will succeed or fail in his financial endeavor.

Technical analysis is important on the stock market: As in all other areas, investors must also follow changing market trends. Proper technical analysis will help investors capture market momentum. Therefore, they will be able to define more effective strategies to cope with the changing dynamics of the market.

There is no such thing as expensive or cheap stock: A 1600 stock is not expensive, and a 30 stock is not cheap. The price of a single stock may not be the right indicator for whether a stock is good or not. It will not be wise to buy stocks just by looking at their prices. Don’t make the mistake of hoarding stocks worth 1600, just thinking that it will benefit you. This is not your local grocery store where a more expensive product is an indication of better quality.

To sum it all up, many potential investors are still reluctant to invest in the stock market due to a lack of adequate awareness and knowledge. It is therefore essential to debunk the myths and learn more about the facts of the market to be successful in this risky business.

Author: Anish Singh Thakur, CEO, Booming Bulls Academy

(Disclaimer: The opinions / suggestions / advice expressed here in this article are solely by investment experts. Zee Business suggests that its readers consult their investment advisers before making a financial decision.)


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