How to Invest in Stocks
Updated: Jul 2, 2020
Investing in stocks of various companies is a great way to make long term wealth. In the long term stock market tends to beat almost every asset class.
In this article, we are going to discuss how you can start investing in stocks on your own or with the help of a financial advisor/planner.
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So let's get right into it.
Investing is an art that one learns over time and can master if one has the passion for it. But how do you actually get started?
1. Decide how do you want to invest in stocks
There are two ways in which you can start investing and both depend on the type of person you are:
a. "I am interested in choosing stocks on my own"
I suggest you keep reading the article as it has a lot of information that new investors need to know.
b. "I would like someone to manage the process for me"
You may be a good candidate for a financial-advisor and should fill this form for our financial-advisors to get in touch with you.
2. Open a Demat account
To invest in stocks you need to have a Demat account with a stockbroker. In India, there plenty of stockbrokers that can get you started with a Demat account on the same day itself.
Eg - Upstox, Motilal Oswal, and Zerodha.
So if you are someone who would like to invest on their own you can open an account with any of the brokers and if you are someone who would like to be advised then it's better to listen to your financial advisor.
3. Shortlist stocks to invest in
The third step in investing is to choose a basket of stock that you want to invest in. For this purpose, we can consider either fundamental or technical analysis. But generally in investing it is better to consider fundamental because investing is a long term game.
It is true that in the long term the prices reflect the fundamentals of any business. If the stock is underperforming due to some reason but the fundamentals of the business are strong then the stock prices will catch up with the growth of the company.
4. Start Investing
Stock investing is filled with interesting strategies and approaches, yet many investors fail in the stock market because they don't stick to the basics.
That generally means investing a bulk of their capital on one stock or industry. Warren Buffett has famously said a low-cost S&P 500 index fund is the best investment most Americans can make — and choosing individual stocks only if you believe in the company’s potential for long-term growth.
DGM Capital is an Investment advisory and Proprietary trading firm that offers wealth advisory and wealth management services to its clients.