Saturday, 4 April 2015

How much money should we start while investing in stock market

In this article we will see the ratio of initial investment in stock market for all types of investors, except An investor from rich family doesn't need to really spent time on reading this article.


An average earning investor (employee) should aim for 500-5000 unit profit. For example 1000 shares of 20 rupees can be sold at 22 rupees to make profit of 2000 rupees as in mentioned ratio. Anything above and below at risk for initial investors. What I mean to say, an investor is looking at the profit of easy 100-200 unit, then it is waste of time. Because the time you spent on earning this tiny profit is too much and worth.  And if an initial investor is looking for profit above 5000 unit, then he/she will need to invest mammoth amount, which would be too risky for initial investors.
Regular investor(businessman) can target for 50,000 to 5,00,000 unit profit. This is because, he/she is so already dwell in share market world, he/she can easily point of stop loss margin instantly. As compared to initial investor  he would just wait for stock price to go up.


Heavy investor (managing directors) can target profit from 500,000 to 500,000 unit. Anything above that is too much risk and anything below such profit margin is not worth for the time for that particular investor.
hope this was helpful.

Wednesday, 1 April 2015

Truth behind share market trend indicator

In this article, we will see what is the real truth behind share market trend indicators. If you don't know about share market indicators then just Google keyword "share market indicators"  and you will find lot of useful stuff. In short, share market indicator are trend based indicator. They provide some idea of whether price of share will rise or fall. I have came across many colleagues and friends who had been telling me the indicator in the share market are very crucial. Share market price is based on three important things, 
  • Profit and loss of company (demand and supply)
  • Technical anaylsis
  • Fundamental news
These days, many broker firms provide technical tools to generate graph and chart for stock so that investors can get clear picture of whether price of share is falling or rising. These technical tools although provide some clear picture of the fall and rise in share price but they do not guarantee.  So the truth is, you can only use them for your decision making process. After technical tools has generate charts, it is up to investors whether to go for BUY or SELL. Just a like whether forecast gives a picture of upcoming nature's behavior, similarly in share market technical tools provides  forecast of share price. Likely, forecast may become incorrect due to sudden fundamental news. 

So in a nutshell, investors can use technical tools or charting tools to get the forecast of the share price. Investors can keep them for BUY or SELL decisions. However investors should not fully dependent on them as forecasts may go wrong.