Showing posts with label How to Become Millionaire. Show all posts
Showing posts with label How to Become Millionaire. Show all posts

Last Updated: Friday, February 24, 2023

A Beginner's Guide to Investing in the Stock market in India

A Beginner's Guide to Investing in the Stock market in India

Here's a beginner's guide to investing in the stock market in the Indian context:

1. Understand the stock market: The stock market is a place where people buy and sell shares of companies. By investing in stocks, you become a part-owner of the company and can benefit from the company's growth in terms of profits and stock price appreciation. However, investing in stocks also involves risks, and it's important to understand the basics before getting started.

2. Open a demat and trading account: In India, you'll need to open a demat and trading account with a brokerage firm to invest in stocks. You can compare different brokerage firms based on their charges, customer service, and ease of use before choosing one.

3. Research stocks: Before investing in any stock, it's important to do your research. Look at the company's financials, earnings history, management team, and growth prospects. You can find this information on financial news websites, annual reports, and other financial sources.

4. Decide on your investment strategy: You should decide on your investment goals, risk tolerance, and investment horizon before investing. For example, if you're investing for the long-term, you might want to focus on stocks of companies with a solid track record and growth prospects, while if you're investing for short-term gains, you might look for stocks that are undervalued or have a potential catalyst that could drive the stock price up.

5. Start small and diversify: It's important to start small and diversify your investments across different companies and sectors to reduce your risks. You should avoid putting all your money into one stock, as this can be risky if the stock doesn't perform well.

6. Monitor your investments: Once you've invested in stocks, it's important to monitor them regularly and keep an eye on the company's performance and news that may affect the stock price. You should also be prepared to sell a stock if it's not performing well or if you need the money for other purposes.

As an example, let's say you're interested in investing in Indian companies that are poised for growth in the tech sector. You might research companies like Infosys, TCS, or Wipro, and look at their financials, management teams, and growth prospects. You could open a demat and trading account with a brokerage firm like Zerodha or Angel Broking, and start small by investing in a few different companies. Over time, you could monitor your investments and adjust your portfolio as needed to achieve your investment goals.

Last Updated: Sunday, May 21, 2017

[Sure shot] How to Earn 1 Crore by Investing Rs 500 only !!!

How to_earn_Rs 1 Crore_investing_Rs500, money_n_business, How to earn 1 crore in 5,000 in stock market

It's really true; you can earn 1 crore or even 2 crore by investing just Rs 500, so read this article carefully as your attitude to becoming a Crorepati is going will be changed. 
Please note; this article is suitable for young investors who want to plan their retirement, if you are above 40 years please do not go through this article and better to refer to my previous posts;

How to Earn 1 Crore by Investing Rs 500 only 

The whole story of being crorepati based on disciplined investment policy. Here we will not show you any magic to scratch a coupon and earn 1 crore within a moment but this is purely based on scientific calculation showing you the power of compounding in stock market investment through SIP (Systematic Investment Plan).
Prima facie to earn Rs 1 Crore by investing just Rs 500, appears to be impossible but you can really earn 1 Crore Rupees (or even 2 Cr and more) if you are ready to spare Rs.500 a month for the sake of your investment/retirement benefit.

I hope investing Rs 500 a month will not create any financial burden on your budget. Moreover, Rs.500 is just a peanut now a days specially for a person who google on the topic "How to earn Rs 1 Crore by investing Rs 500"

No matter what's your financial background is; either you are from a middle class family, government employee, having job with a private company or just a student, you must be in a position to spare at least Rs.500 per month, isn't it? 

So, earning Rs 1 Crore by investing Rs 500 requires your patience only. All you need to do is simply invest smarty and forget for the time being. I hope you can do it easily after reading this article till end, specially when it comes Rs.500 a month, right? If you are agree, this article will certainly help you to clear the entire picture for becoming 'Crorepati'.

Important point to note;

  • How to turn Rs 500 into Rs 1 Crore?
  • One sure way to becoming a 'Crorepati'.
  • To spare at least Rs.500 per month.
  • Power of compounding in SIP. 
  • Becoming ‘Crorepati' requires your patience.

Well, to earn Rs 1 Crore by investing Rs 500 per month you must have sufficient time say 30 to 35 years to grow your investment. We have made a calculation here as to create an investment of Rs 1 Crore or more by investing Rs 500 per month (calculations have been made by using IIFL SIP Returns Calculator);

Way to Earn Rs 1 Crore by investing Rs 500

Monthly Investment Amount  :      (Rs.)  500
Investment Period In Years     :                  35
Returns Expected (% Annualised)  :   16.10%

End Value of your Investments :  
Rs. 10,150,287 (1.02Cr.)
Amount actually paid                :      Rs.  210,000
Times amount gets rolled-over  :             35

In above calculation what we see is; if you invest Rs. 500/- per month for a period of 35 years in an investment which fetches a minimum CAGR of 16.10%, your total investment of Rs. 2,10,000 is multiplied by 35 times over a period of 35 years and hence you will get Rs. 10,150,287 (1.02 Cr.).

Way to earn more than Rs 2 Crore by investing Rs 500

Monthly Investment Amount :       Rs.500
Investment Period In Years:              38
Returns Expected (% Annualised) : 17%

End Value of your Investments    :
Rs. 21,825,061(2.18 Cr.)
Amount actually paid                   : Rs. 228,000
Times amount gets rolled-over     :         65

Again in above calculation what we see is; if you invest Rs. 500/- per month for a period of 38 years in an investment which fetches a minimum CAGR of 17% , your total investment of Rs. 2,28,000 will be multiplied by 65 times and hence he will get Rs. 21,825,061 (2.18 Cr.). 

How to invest to Earn crores?

Of course you should invest in stock market to achieve your target because other investment cannot fetch as much as return required to you be a crorepati. Again if you are not an expert in how to to invest directly in equity market, you should go for investment SIP in of selected stocks, ETFs or in Mutual funds having fabulous track record of a minimum compounded return of 17%.

How many years do you need to invest to earn Rs 1 Crore and more?

As per above calculation to earn Rs. 1 Crore, you should invest Rs. 500 a month in selective SIPs, Stocks, ETFs or Mutual funds systematically over an average period of 35 years which fetch at least 16.10% CAGR on your investment. 

Similarly to earn Rs. 2 Crore a monthly investment of Rs. 500 over a period of 38 years which fetch at least 17% CAGR on your investment. Find Top 10 Mutual Funds in India (Crisil No.1 Ranked) in my previous post.

Where to invest?

The best option to achieve your target is stock market where you should directly invest in quality large cap stocks having good potential, if you are master in finding value picks its an easy task for you. Again if you are not an expert in investing directly in stocks/shares do not worry you may invest in ETF like NIFTY ETF etc; where you have to make no effort to examine growth potential of the companies as your investment will grow each time nifty/index will rise. Investing in nifty index is supposed to be safer as your money will be invested in top 50 companies of India. If you are still worried and find it difficult to invest directly then you should invest through mutual funds where fund managers who are professionally expert in investment will do every sort of investment work for you. To know more about refer to my previous post Top 10 Mutual Funds in India (Crisil No.1 Ranked).

Is it possible to get more than 16% CAGR on your investment?

yeah it is quiet possible to get 16-17% or even more return when you invest in stock market. If you see track record of Sensex for past 30 years, you will be surprised to know that it has delivered a return of 17% CAGR and expected to deliver 26% CAGR in coming 20 years. It means if you do nothing but invest in INDEX only, you can easily earn Rs 1 Crore by investing Rs 500 in 35 years and more than Rs 2 Crore in 38 years.

"If you have any query on the current article please free to contact us by just dropping you message here, I will soon be in your touch."

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Last Updated: Monday, January 9, 2017

OMG! 90,000% Return on your Equity Investment in 10 years!

90,000 % return on your equity investment in 10 years! What a multibagger stock this is!
We know, that will leave you agape! But it's true. Look around you, some people around you might be among the luckiest investors who have made this happened. An analysis of stock prices revealed that five stocks of BSE have soared between 10,000 and 91,000 per cent since December 2006. Multibagger Stocks, 100 Bagger Stocks, 1000 Bagger stocks, 10,000 Bagger stocks or Million Bagger stocks what will you say to these blockbuster stocks?

Symphony Limited: 

Image: symphony ltd_10,000 and 91,000 per cent since December 2006. Multibagger Stocks, 100 Bagger Stocks, 1000 Bagger stocks,10,000 Bagger stocks_Million Bagger stocks

Among the biggest winners shares of Symphony Limited proved to be a true multibagger stock which climbed 90,677% to Rs 1,180 on December 5, 2016 from the price of a chocolate caramel to Rs 1.30 as the stock quoted on December 29, 2006 (NSE, India). Thus, an investment of Rs 10,000 in stock in December 2006 would have been Rs 90.77 lakh today; A 3-BHK apartment at the price of a caramel!
Symphony’s net income has increased at a CAGR of over 50% over the past 10 years. The net profit of the Symphony rose from Rs 2,20 crore in 2006-2007 to Rs 123 crore in 2015-16.

Last Updated: Saturday, February 6, 2016

Winning Strategy: How to Play Intraday Trading

Prima facie intraday looks to be the easiest and the most rewarding way to earn quick bucks in stock market. But the fact is just opposite; most of traders lose money in intraday gambling as they fail to respond very prompt and quickly to market volatility. So to be a successful day trader you should follow certain rules. When you play any other game like cricket or chess you have to adhere to the assigned rule, similarly Intraday traders have to follow some common trading rules. If you won't follow basic rules then intraday becomes that game where profit of one day is wiped out another day. In present post I have tried my best to figure out some of the important intraday trading tips based on my own experience, hope this will help you all.

How to earn money in intraday trading : Sure Shot Winning Strategy

Step by Step Intraday winning strategy

1. Do not Mix the terms 'Trading' and 'Investment'!

Before you start intraday trading the first thing is to think again and to decide whether you are a trader or an investorIntraday, trading and investment are three different things you should not mix them together. No matter all these involve buying and selling scrips; the strategies involved are quite different. See how it works;
  • Investment = 90% fundamentals + 10% technicals.
  • Trading = 90% technicals + 10% fundamentals.
  • Intraday = 90% technicals + 8% psychology + 2% fundamentals.
It is clear here; traders take into consideration technical data, while investors look at fundamentals of the company. Don't try mix the two term. 

2. Check trading volume to ensure liquidity!

Day traders must ensure that they are trading in highly liquid stocks as they have to square off their positions in stock at the end of every trading session. This is not an issue when you are trading in large-cap as most of the large caps being index-based stocks, are traded with satisfactory volume. Most of the stock experts say no to mid-cap and small-cap shares because such stocks are traded with thin volume. But you can still trade in mid-cap and small-cap shares and even in penny stocks; all you need to do is just satisfy yourself with good trading volume of that shares. If stocks you are trading in is not liquid you could end up holding shares with no buyers at the end of trading session.

3. Fix entry and exit point before you make a position!

Fix your entry level and target price before you make any position as the mind of the trader changes after he makes a position in a scrip. This behavior sometimes affect his judgement which force him to sell too early or not to sell at all even if the scrip moves adversely. In this way he loses the opportunity to enjoy full upside gain. So, next time when you do intraday trading first set entry and target price. Once you have done it, adhere to it and let the stocks to hit either your target or stop loss. For keeping target and stop loss you may refer to my previous post which depicts in easiest way "when to Buy" and "when to Sell".

4. Square off your position at the end of trading session!

The next mistake by intraday traders is; when they are having loss in their position they hold the shares for next trading sessions and by doing so they are compelled to pay high brokerage for delivery of that stocks. Further, shares bought for very intraday/short-term horizon may not be of good fundamentals, hence it makes no sense to hold it. No matter you gained or lost you must square off your positions  at the end of every trading session.

5. Honour your Stop Loss!

Stop loss limits your losses if the price of the stocks goes against your expectations. In simple words it is a trigger point for buying & selling of scrips you are holding, Stop Loss is triggered when the stock moves beyond a specified price limit. Suppose you buy 50 shares of Infosys at Rs 1140 each and you set a selling stop loss of Rs 1120 if for any reason the share of Infosys falls below Rs 1120, your Stop loss will be triggered and a selling order will be sent to your broker; in this way, your losses will be minimized to the extent of Rs 20 per share even if the share drops to Rs 1100. 
Read more at >>> 
  • How does a stop-loss order work?
  • What is trigger order?

6. Book profits when it meets target!

It goes without saying, intraday trading game is profitable only when it is done in a pre-planned way. The two psychological issues associated with intraday trading are 'Fear' and 'Greed', in order to cope up with 'Fear' and 'Greed' pre-determined target and stop loss is suggested to the trader. Make sure booking profit when your targets are met; by doing so you will never repent for profits to have been booked. 

7. Don't trade in  more than 3-4 scrips at a time!

It's imperative to diversify your portfolio if you are trading/investing in stock market. For an investor diversity up to 10-12 scrips is suggested but when it comes to a trader, limit yourself to just 3-4 stocks. However you may have up to 10 to 15 scrips in your watchlist which you track regularly. As a trader you need to track stock movements closely and continuously, so trading in more than 3 to 4 scrips at one go is not suggested to a day trader. 

8. Don't hesitate to research thoroughly!

A trader need to do more research work than that of an investor, do not hesitate to research thoroughly on stocks in your watchlist. Update yourself with all forthcoming news & events such as shareholding patterns, bonus issue, dividends, stock splits, result dates & analysis, mergers, credit rating, expert views etc. of the stocks. There are certain websites & mobile apps which provide their free services as to stock market where you can find high, low and closing price of stocks as well as their resistance and support levels. Some of the popular site are;

9. Trend is friend: Don't fight with it!

As a trader you should not fight with market trends. Despite all technical factors the scrip you are trading in, may not trade as per your expectation if market does not support it. A stock might be bullish on chart but to trade accordingly it always need a favorable market trend, remember market spares no one. If market trend is not as per your calculations better to go with trends or not to trade that day. If you don't follow it is more likely you will end up with a losing session.

10. Small is beautiful!

While intraday trading can fetch a stupendous returns in a single trading session, it may also bring huge loss to a trader if target is not set rationally, Always go with small target to avoid losses. As an intraday trader you get an opportunity of leveraging your trade, you can earn handsome amount even if your scrips go up by 1% or 2%. As per 'Fear' and 'Greed' psychology there is higher chance of loss if you set a target higher than 3%. So, small is beautiful.

11. Learn some technicals!

As we have already seen how intraday trading is a game of 90% technicals, you should learn at least some basics of technical analysis. In most of the cases technical analysis does work. If it were all about fundamental, shares should have fluctuated only four times a year i.e. on its quarterly result day but why they fluctuate hundred times a day? There is number of books on 'Technical analysis' available online for free or at a very attractive price, take help from them.

12. Don't let your emotions control you!

For a trader emotional intelligence (EQ) is much more significance than one's intelligence (IQ). Emotions are like a watchman who filters out your decisions, trading is equally interlinked with human emotions. So you should manage your emotions and temperament to be a successful trader. It totally depends upon one’s psychological makeup; some people are patient while some are impatient similarly fearful, fearless, slow decision maker, prompt decision maker etc. selecting the best suited trading style would lead you to a sustained success not only in intraday trading but also in investing.

13. Don’t listen too much to experts or advisers!

No one can guarantee for 100% success in stock market; market spares on one. Better try to develop your own trading style rather than listening too much of experts or advisers on TV and websites. If you depend highly on experts opinion or any paid service you will ignore your own trading skills. Here you should L-E-A-R-N first and then remove 'L', in long run you will surely E-A-R-N. The only way to make money in stock market is hard work and self study, nothing can substitute self acquired knowledge & experience. One should listen to all but should apply own trading style. Everyone has to write his own paper in the exam of stock market. 

14. Keep your trading costs low!

Try keep your trading costs as low as possible. If you are paying high brokerage you will not be able to set small targets. When you open your demat account ask your broker regarding brokerage rate, you can also search online to ensure attractive brokerage plan. It's a simple economics funda; other things remaining same, the lower the cost is the higher profit will be. Most of the brokers provide flat fees of Rs. 20/- per trade which reduce almost 90% of brokerage costs.

Though I tried to explain all important aspects of day trading tips yet I believe there are thousands to be discussed, everyone has his own trading style depending on his experience. No matter what strategies you are applying the result should be in profit only. Please do share your ideas/suggestions on present post "How to Play Intraday Trading Game".

Most frequent questions; 
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Last Updated: Monday, December 21, 2015

How to Become Millionaire by Investing In Stock Market?

How to Become Millionaire by Investing In Stock Market?

How to Become Millionaire by Investing In Stock Market?Everyone has its own trading and investment style in stock market but they all have the common question in their mind "How to Become Millionaire by Investing In Stock Market?" In fact it is tough to find out a quick fix trading and investment style in stock market but some Fundas are almost common among all millionaire investors/traders. In present post I have tried to express some of the most discussed trading ideas and  investment ideas in order to explore "How to Become Millionaire by Investing In Stock Market"?

How to Become Millionaire by Investing In Stock Market?

1. Trading with Trend: Bet on Winning Horse
Image:How_to_Become_multi_Millionaire_trading_Investing In Stock Market?
As you have just initiated your steps in stock market with plenty of dreams, you should make sure to focus on Buzzing stocks i.e. stay tune with trend as it is said "Trend is friend". At the same time we suggest you to do your pwn research, look into their price patterns and focus on stocks which are already in momentum as you plan to go with them until they reach new heights instead of focusing on stocks hitting new lows. 

2. "Buy" and "Short Sell" are the Two Aspects of the Stock Market

Some of the trader think they need a bull market to get rich in stock market but this is only a half story and  it isn't the case. Don't hesitate short selling in trend is downside, you should not have to hold on to a stock for a long time to earn a profit, but look at the success story of some day-traders have; they are the epitome of earning off of short selling. Nothing wrong with short selling as you are in stock market to earn money only, remember if you are adhere to the old principles then you will still be found searching somewhere the term "How to Become Millionaire by Investing In Stock Market?"  on Google throughout your life like today you did it.

3. Book Your Losses Quickly
If you want to to Become Millionaire in Stock Market, take your ego completely out of the situation. In case you face a set back, book your losses and move on fast. Do not dwell on your stupid decision,  instead look to the future opportunity. You are going to fail, so mindset yourself and just be ready to move on another opportunities.

4. Don't Hesitate to Book Partial or Entire Profit
The interesting thing about your un-booked profit is that they aren't really profit until you book them. you should not hesitate to book partial profits or take entire profit too quickly. The Stock market changes fast there is nothing wrong in getting out when you feel it is right time to book the profits that you have earned.

5. Taking help of  New Technologies 
Nothing in the world is changing fast than technologies,  so be the change if you want to be Millionaire in Stock Market. Now is the time to be associated with modern sophisticated technologies. There are the business of the future, Knock new technologies and business models and be willing to stay ahead of the time as you look to your investments in future.

6. Prefer Liquid Stocks
If you really want to earn some serious money in the stock market, this is good to stick to liquid and highly traded stocks. Try to abstain yourself from illiquid stocks as these are the stocks which make big promises but followed by some downtrend.

7. Don't trust anyone in the Stock Market, Do your own research
In the trading world of stock market, talk is cheap. Don't listen to or trust promises or hype  at all, look only the way stocks are behaving, you should do your own research by looking into how the stock you are tracking is performing and what action it is really taking in the market. This is the way you can understand what to expect from the stock you are tracking in the future.
8. Diversify but avoid too much of it;
Everyone in stock market suggest not to put all of your eggs in one basket even I believe the same but too much diversification is not the way to be Millionaire through Investing in Stock Market.  I have my personal experience is too much diversified investment creates obstacle in booking profit as we gain high in percentage return but few in monetary return. One should typically keep one to two stocks at a time and should not use more than 30% of one's assets in investments, that's it.

9. Don't Leverage;
Spread your legs according to the blanket, So many people talk about Derivatives/Options/Future trading by using leverage but this is not the way to be Millionaire in Stock Market. One must avoid leveraging and doing margin trading in the stock market unless it becomes inevitable to do so.

10. You Don't Need to give bottom finishing nor to Sell at the Top
No one in the stock market can buy at the bottom and sell at the top, so many of new traders having dream  to be Millionaire in Stock Market are focused on the old adage that they need to buy right at the bottom and sell right at the top. Though it would be nice if you could do the same but you just need to focus on the meet of the move, not necessarily the top and bottom. Instead you should get in during the middle and still make some major profits.

I know you might be missing some of the important trading ideas in above post and if it is; it is due to my commitment to keep this article as short as possible. Please do post your valuable comments and suggestions as to present post "How to Become Millionaire by Investing In Stock Market?"

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