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  Tips for Beginners
Saturday - 20th June, 2009 | ResCon
 
 

Welcome to the stock market!! Here you can get maximum return by investing your savings. But the risk is also high. If you analyze the company carefully and the market news, these risks can be massively minimized. TIP: Don’t believe in what one broker or the investor says about the stock; study and be informed about the company before making any investment.

Most of the beginners in the stock market invest into securities without analyzing the company’s financial strengths, its future growth, income perspectives etc. based on irrational decision. Of course, the rate of return is very high in stock market but remember that investment should be done by judging the company’s performance and understanding the market sentiments. So in order to achieve high rate of return by minimizing risk, gather as much as information about the company’s performance, management, growth aspects etc. Information is the vital source to better investment.

If you are a short term investor, you need to focus on the capital gain (achieved from the price appreciation). And if you want to buy and hold the stock for a longer term, your focus must be on the capital gain summed with the ordinary gain from the dividend income. The investment on secure and good company does yield good returns in the long run. But it is always profitable to be a short term trader by buying the growth stock and selling up the declining stock.  

Golden Rule: Buy the stock which will appreciate and sell the stocks which will depreciate at the right time. For that you need to analyze the stock to see if it is undervalued or overvalued. Buying the undervalued stock and selling the overvalued stock (if you have) will increase your total return. Remember what Warren Buffett, the Oracle of Omaha, says on investment: Rule 1: Never lose your money & Rule 2: Don’t forget Rule 1. See.... it is easy.

You might want to consider this as the next important tip:

Though stock market is risky, if you invest with suggestion and advice from us, you can better channelize your investment. We, as a stock analyst, continuously research the stock market and monitor the price of the individual stocks. We know that whether a particular stock is overvalued or undervalued. We have different fundamental and technical tools to analyze and pick the best stocks that suit your investment appetite.