How do I begin to invest in the stock market?


#1

I am really new to stock market from where should I start and what are the steps that I should take?


#2

Money Matters - You asking the question of how to start is the first step.

Before getting into real detail I would like to share with you a simple image that explains the advantages of investing early or starting early.

Start with some basic ETF with a long-term goal. Such as gold and equity index. Once you start investing in ETF and start tracking on a regular basis you would get a hands-on it. While on the other hand while you are investing in long-term you are learning as well as starting your investment career.

Understand the difference between Trading [1] and Investing.

Many want to start investing in the stock market but then end up trading[2] becuase of lack of funds.

Never start trading in the Stock Market in initial days unless and until you gain experience and confidence.

Now I am going to list down the exact things one can do to get hands-on experiences to start investing in the stock market.

  • Read Books

This is the best thing you can start off with. Below is the list of books that are recommended by a popular Facebook group. Find the list below.

Once you finish the above books you would automatically get related betters books to continue reading.

  • Read Business Magazine

The business magazine gives you better and different insights which is otherwise not possible.

Best and cost-effective options are to subscribe for magzter which I what I do.

Magazine brings forward their own research and insight mostly from industry veterans. Latest happenings in the Indian business world and much more.

Some of the favorite magazines that I usually read is Forbes India, Business Today, Inc India, Business India, The Smart Manager etc.

  • Lingo

You got to start learning the lingo when it comes in the stock market. Importantly to grasp things which otherwise would be very tough without the lingo.

There are so many terms when it comes to the stock market you don’t have to know all of them to begin with but knowing the basics is the most important.

Regularly reading books and magazines will also help you get your lingo better.

Initially, it might be a little challenging but it would be easy as you continue reading.

  • Take Notes

You learn and take notes.

This will make it easy for your to recollect rather than going back and forth reading the whole concept again.

Learn to convert the entire topic in short bullet points so that it becomes easy for you to recollect.

Especially with some of the Principle Learning or Most important learning.

Find some of the interesting concepts below.

Or something which covers Simple Stock market terms.

  • Watch Educational Youtube Videos

The number of educational videos and strategies online are unlimited.

Most of the concepts can easily be found online.

Like when I started looking for Pair trading I had almost no content or anyone with an experienced person on the same. That’s when I came across a course taught by Professor Steven Skiena at Hong Kong University of Science and Technology in 2008 which was otherwise not possible.

The interesting concept taught you can also find the link below.

There are specific channels that talk about the stock market which is easy to get continuous lessons.

  • Take Online Courses

Needless to say, youtube videos are good but definitely not sufficient. There are certain things that might not be taught to you in a free course that’s when you would be introduced to special concepts and strategy.

There are similar many courses the above one is just one of them.

  • Read Audio Books

Audiobooks or podcasts are another interesting sources of learning. This would be handy if you are unable to read or not able to give time is online courses.

There are certain business channels which broadcast business news, pieces of information and analysis. This would be very useful in your learning curve.

  • Blogs

These days the number of blogs is increasing very fast with really high-quality content.

Right from personal finance concept, investment strategies and trading strategies there is a blog for everything.

There are also certain niche blogs which talk about advanced concepts and strategies.

  • Experiment with Stocks

The best way of learning is to start off investing[3] your pocket money. You might make mistakes no doubt about it but your learning curve will grow faster.

Visiting a broker’s office or looking at your family investment would be another source of learning.

If your parents have consulted any of the financial planners make sure you are present at the meeting with them I am sure you would not understand completely but whatever you learn and understand would be beneficial to you.

  • Track & Invest in Mutual Funds

Understand how mutual funds work. You can start as small as Rs. 1000 per month.

One of the biggest advice for those who want to start investing is to have patience. Investing takes time and one should have patience. It’s a very long game, “Plan your action and take action on your plan”. Wealth[4] from investing grows with time more than any other things.

Go Look at your Investing and Trading Strategy right away. These small tweaks will have a larger impact on your Trading and Investing activities.

If you have reached till here than I am sure you have enjoyed reading the article. An upvote and share would really motivate me to write more similar queries.

Thanks for reading

Footnotes

[1] Chintan Chheda’s answer to Is it a good strategy to buy stocks and when they rise to sell half of the stocks and keep the rest for the long term?

[2] Chintan Chheda’s answer to How do I generate a decent profit doing intra-day trading online in NSE and BSE?

[3] Chintan Chheda’s answer to Is it a good time to buy shares or wait for a while?

[4] Chintan Chheda’s answer to Is it a good strategy to follow Graham Benjamin’s style of investment and buy stocks in the Indian stock market with P/E < 20, P/B < 1.5, and a consistent dividend?

Originally answered by Chintan Chheda on quora