Stock Market

How to make money through stock

market?
How to make money through stock
market?
Stock market is a business. For doing any
business, you have to learn and understand
about it. You can’t do a business without
learning and without any experience.
How to make money through stock
market?
In any business, the profit and loss
depends on that how much we know
about the business. The more the
knowledge and experience we have,
the more we make money.
How to make money through stock
market?
But there is no guarantee that you will
make profit from your business
everytime. There are the chances of loss
in business. So, you have to be prepared
for both profit and loss.
There are the two main ways for
making money in stock market:
1. Capital gain
2. Dividend
 Capital gain
Capital gain mean increase in capital.
Capital means investment in any
business to make money from the
business. When you invest in a
business, you make money from it and
in this way, your capital increase.
 Capital loss
Capital loss mean decrease in capital.
The growth of business increases with
capital gain and growth of business
decrease with capital loss.
 For Example
For example, if we purchase a property,
then it means we are investing our capital
in it. After some time, when we sell it,
its price increase, then it is called capital
gain.
Types of Capital gain
1. Short term capital gain
2. Long term capital gain
Short term capital gain
Sort term capital gain means that the
profit from the sales of shares within
one year after purchasing the shares.It
is called short term capital gain. The
profit made by trading is called short
term capital gain.
Trading
Trading means buying and selling of
shares. Just like a business, in trading
we buy different shares at low price
and sell them at high price regularly
and make profit through this process.
Short term increase or decrease
In stock market, the prices of shares
move up and down constantly due to
many reasons such as Announcement
of financial statements, any thing
about economy and political issues
etc.
Trade of shares
Thousands of people buy and sell
millions of shares on daily basis in
stock market. So, you can trade the
shares in stock market easily and
make money through it.
What to do in trading?
In trading, we buy the stocks that are
at low price if they are likely to move
upward and we sell the stocks we
already held if they are likely to move
downward
Source of income
If you do not have much more money
and you want to make money than
stock trading is best option to make
money if you had learned everything
about it and you have litle bit of
experience
You can make an
average of 10% a month
by stock market
trading.
Liquid stocks
In stock market, you must buy that
shares that are being traded in large
quantities because if there is no buyer
than you can’t sell your shares.
Long term capital gain
long term capital gain means that the
profit from the sales of shares after
one year after purchasing the shares.It
is called long term capital gain. The
profit made by investing is called
short term capital gain.
Investing
Investing means to invest your capital
in a business for a long period of time.
If you want to invest your money than
stock market is the best place because
the inflation decrease the value of your
money if it is cash.
How to invest?
Investing does not require a lot of
money. If you have a source of income
than you can spare a part of your
income for buying shares and you can
buy them every month. You should
must learn about investing.
Saving
Most of the people spend a part of
their life to save money to invest and
in this way they waste their precious
time and money. I am not saying that
you should not invest in real estate. If
you have money and
and knowledge about real estate than
you can invest in real estate but if you
do not enough money than you can
invest into stock market because saving
can’t make you rich.
If you want to become rich than you
have to invest your money.
Time period
Stock market is the best investment.
You should stay with your investment for
lifetime but minimum time period you
think should be 15 to 20 years. You should
must invest in stock market even if you
have your own business.
 Dividends
You can make money in stock market
through dividends.They are just as same
as the profit you get from your property
as a rent in which you have invested.
Definition:
Every company which make a profit
distribute a part of it from net profit to the
shareholders which is called
dividend.Every company give dividends
one time in a year or two to four
dividends.
Benefits of investing
1. Long term capital gain
2. Dividends
Why the stock price increases?
Reserves:
The companies keep reserve from the
net profit they earn and reinvest that
money into their own business to buy
assets which
Which increases the sales and due to
increase in sales, the net profit of the
company increases. When the net
profit increases, the capital of company
increases. Due to increase in capital,
stock prices increases
because the companies do business
with the help of capital. The more
good the company do the business,
the more dividends the company pay.
That is why the stock prices of the
company increases.
Payment of Debt:
A some part of money which is left
after keeping the reserves is used for
the payment of debt.
Dividends:
After the payment of debt, the dividends
are paid to shareholders.