TOP 10 REASONS TO MAKE INVESTMENT IN SHARE MARKET
Here I am explaining the investment plan for earning extra money in addition to your tax savings schemes.
I have mentioned reasons why investing in the share market is more beneficial than another available investment plan. I advise you only for investment, not for day trading.
Day trading requires great knowledge of the share market. Before starting investment in the share market, you should acquire some knowledge about the share market with the help of Money control, NSE apps, or by Newspapers such as Economic Times, Businessline or viewing CNBC or any other Business channel on TV.
Open a Demat account directly in Bank such as SBI, ICICI, AXIS, Kotak Mahindra, or through a Broking agency such as Angel Broking, Sharekhan, etc.
If you have time to analyze the shares of different companies, then u can directly handle your investment otherwise, u take the help of any broking agency after getting registered with them.
Never buy shares on the advice of others. First, you analyze personally before buying any amount of shares.
The first year of investment will be a slower & smaller amount. For optimum benefit, you should make your portfolio with a variety of stocks such as
1. FMCG companies,
2.Auto & auto ancillary companies,
4. IT sector,
6. Pharmaceutical Manufacturing companies
7. Real Estate companies
8.Building Material companies
9.Electrical & Electronics Goods manufacturing companies
10.Oil & Energy Sector.
Balance Portfolio can give you a guarantee of 12-20% yearly growth. But unbalanced portfolio trends you towards lesser growth of your fund.
A balanced portfolio can give you opportunities to sell one lot of stocks at any moment. I HAS BEEN WRITTEN THIS POST WITH THE HELP OF MY FRIEND GAURAV PANDEY.
REASONS FOR INVESTMENT IN THE STOCK MARKET
1. Better than FD (Fixed Deposit):-Normally inflation rate varies in between 5-7%.All bank’s FD rate is between 6-7.5 %. If you invest Rs. 100 in FD then you get Rs. 107 after one year. It means that in a one-year duration, FD amount is just equal to Rupees value due to inflation.
But if you invest in the Share market, your money can grow 14-22%. For example: In 2009, I have FD Rs. 35000. In the Nationalized bank. After completion of 5 years, I got Rs. 52000.00. But same time my friend got Rs. 75000.00 including all yearly dividends by investing 35000.00 in Share Market.
2. The flexibility of amount during investment:-You can invest any smaller or bigger amount in the Share market. There is no minimum limit on the investment amount. It is better to increase gradually your no. of shares in any company.
3. Investment convenience:-For Invest, it needs only one DEMAT account in any Bank by self or any broking agency. Nowadays all Demat accounts can be handled through a laptop or smartphone.
4. Liquid money:-It is just liquid money. As per need. You can sell your share & get this amount in your account. The Same facility is not available in other investments such as FD, NSC, PPF, or Purchase of land or flat. As per your need, you can sell one lot of stocks from your balanced portfolio.
5. Converts you as a Financially Intellectual person:-It increase your financial knowledge about the business world. In your spare time, you can enhance your knowledge by Moneycontrol apps or NSE apps. This means it saves you from excessive use of WhatsApp, Facebook or any other social apps.
6. Involvement of Wife:-After getting the basic knowledge of the Share market, you can involve your wife in this business. She will also get some positive work to compare to viewing programs on TV only. Give them a daily list of companies & ask them to analyze their financial data.
7. Best Gift to your children:-After a long time, you become the expert in this sector. You can teach your children basic & complex knowledge of the share market. This means they can start investing share market at an early age (after 18 years only). So they get expertise in this sector as their inheritance.
8. Best retirement Plan:-Every good company gives dividends yearly. This amount is in addition to your invested money in this company. Regular investment up to your retirement will generate a great amount in the share market. This means after retirement, you will get a huge amount on yearly basis as a dividend as your regular income.
9. Source of White Money:-During the purchase & sale of shares, the Government has deducted some amount from your invested money. If you don’t sell your purchased share within the year, you will save from capital gain tax. Every month a small regular investment becomes a huge investment at the end of your retirement. Also, you can answer any Govt. agency about this money.
10. Ease of Conversion from shares to another investment:-After a long time of investment, there will be a huge amount in your Demat account. At that time you can sell them. This money can be used in purchasing a car, land, or booking a flat. After a long time, it is good to sell a share for buying flat or other property. Profit is much more in investment in land/flat than in shares.
I have mentioned a links about investment tips for your extra money. NINE SMARTER WAYS TO USE YOUR BONUS/EXTRA MONEY.
Above shown images used for illustrative purposes only. No Copyright infringement intended.