Trading in the stock market is exciting yet challenging for new traders due to the different factors involved.
There are two stock exchanges in the Indian market, the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).
As a trader, you can trade in equity shares, futures, and options, on these exchanges.
In this article, you will learn how to start the trading procedure on the stock market, the steps involved, and other relevant information.
Stock Trading Online
Before you begin trading, here are some important things you should consider to make the most of it:
- Learn Stock Analysis
Learn the key terms and different concepts related to the technical analysis of stocks.
Technical analysis evaluates the price of stocks by measuring the performance of a company and other parameters like profit margins, earnings, assets, and more.
With technical analysis, you can check the past price of the stocks, and trading volume, to predict how it will perform in the future.
This way, you can understand all important terms and other key features of the stock you want to trade. Trading in stocks without analysis is not recommended, especially for beginners.
- Stock Comparison
Make sure to compare the performance and key metrics of one stock with others.
This will help you get to know about its performance and the various competitors of the company whose stocks can trade, too.
Analyzing the market trend will help you find the right time for maximum profit.
Certain key factors that must be compared while selecting a stock are price-to-earnings ratio, market capitalization, size of the company, analyst ratings, dividend yield, news sentiment, expected earnings growth, and general public sentiment.
Studying past market data to identify the pulse of the stock market is crucial for making informed trading decisions.
- Manage Risks
The share market is always volatile and the price of stocks keeps on fluctuating.
As a beginner, you must understand how this works so that you don’t face huge losses in the market.
Always keep a stop loss price when making a trade, so that you face minimum loss.
Maintain a regular stock review and avoid emotional trading. Another foolproof method is to determine personal risk tolerance, select defensive stocks, and trade consistently to practice tricks of the trade.
- Start Slow with Stable Stocks
Your confidence will take a massive hit if you face a big loss at the start. Therefore, it is better to start slow with safe stocks that are less volatile.
You may start slow but you can perform well and make profits even as you learn. In the long term, you can take bigger risks once you get the hang of the market.
- Diversify Your Portfolio
You should keep a diversified portfolio and trade in different stocks, not just focus on a few companies. For instance, trading specific metal stocks could prove to be detrimental for you in case the global metal market sees a slump.
How to Start Online Trading in India?
You need to choose a reliable and trustworthy platform like Dhan and open your trading and demat account to get started.
You don’t need to deal with any middlemen or brokers and have 24/7 access to the market from the comfort of your home.
Also, there is no complex paperwork involved in online trading as you can open your demat account and begin trading.
For a lightning-fast stock trading experience, you can opt for the Dhan platform. Follow these steps to start online trading in India.
- Visit the Dhan website here or download the mobile app on your smartphone.
- Next, you have to open your Demat account on the platform so that you can start trading online from the comfort of your home.
- Once your account is set up, you need to log in to your trading account. Next, add money to your account so that you can Trade stocks and start.
- Check out various stock details, their price, their recent performance, and other analytics.
- You can buy and sell stocks online right from your Dhan trading account via web or app.
Dhan recently became the first broker in the world to allow Options Trading from TradingView's Trading Panel! Go check it out here!
Conclusion
Online trading is a great way to buy and sell stocks conveniently. Before you start, make sure to have a proper understanding of the market and build an effective strategy.
In this article, we have covered all the important pointers you need to get started. So, do your research, make a trading plan, and start trading.
Also, always make sure to play it safe in the beginning and gradually grow your trading portfolio as it will benefit you in the long term.
