25 Basic Rules For Investing Money In Stock Markets

Basic Rules For Investing Money In Stock Markets Stock analyst telling the basic rules of investing money in stock markets.

(2) Never Invest In Company You Don’t Understand

It is one of the highly ignored rules for investing money in equities. Smart investors are those investors which prefer to invest only in those companies or sectors in which they are familiar & understand.

You should be able to understand the strength & weakness of stocks & prevailing competition in the industry. You should also be able to compare the performance of stocks over its peers, etc.

If you don’t understand the business concept of a company then you can’t make money from your equity investments.

[Read Also: 16 Tricky Ways To Identify & Pick Multi-bagger Stocks]

(3) Investing & Trading Are Not Similar

It is one of the significant rules for investing money in stock markets. Share trading is meant for short term & share investment is meant for long term. If you can’t differentiate between the two options then perhaps you are about to lose money.

You should first decide your ultimate goal for investment in equities. However, you should not forget to analyze what works for you & what doesn’t work at all.

You should be ready to learn from your previous mistakes. You should go for equity trading in some portion of your equities and keep remaining portion for long term investment in equities.

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2 Comments on 25 Basic Rules For Investing Money In Stock Markets

  1. hey, really a very nice & informative post…

  2. Narnolia S. // June 22, 2017 at 12:52 PM // Reply

    This is a really informative blog. All investor should know these 25 basics rules for investing. I truly appreciate your rule #13 where you have stated ‘Your success & failure in trading activities will largely depend on your consistent ability to buy low & sell high’. Look forward to more such informative write-ups.

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