Introduction to Online Trading:
Nowadays, in India, you can see more advertisements for online trading in IPOS, stock cash, stock/index/currency/commodity futures, stock/index /currency option, ULIPs, Financial TIPS and other financial products in Newspapers, TV, Internet, TeleCalling, SMS, Radio, MALLS, Shopping complexes etc . Several marketing executives approach and explain to you about their products.
They talk about more profits (in lakhs) on monthly basis with minimum investment.
How a person can earn several lakhs with minimum investment?
The main reason for their advice is because with less amount of money (margin), you can trade MORE in Intraday (Stock), FUTURES, Options etc. Margin is the amount that you have to pay to the broker to trade on financial securities. If your analysis is correct, you make more profits, otherwise you lose money. Before going into detail about stock, futures, options, you will learn about investment, saving and the risk associated with it.
Whatever we share with you is "Free Online Trading Education" and you will get to know about 360 degrees of online trading and we will share the best practices in online trading.
What is Financial Investment?
The money used to buy securities like new Stocks, Futures, and Options etc. This is mainly done to get more profit.
What is saving?
Saving is a portion of the money that is not spent from income. The money saved can be credited in savings bank account, Post Office Savings Scheme etc. You get interest on your saving.
Savings without RISK on a Longer Term: No Trading:
Few examples are Savings Account, Fixed Deposit, Recurring Deposit, Post Office Savings Schema, LIC plans, Public Provident Fund. When you save without risk, you may get interest rate of 4% to 10% approximately on a compounded basis. Your return is guaranteed if you fulfill the terms and conditions of the bank or post office or some other financial institutions. If monthly installment is 10,000 rupees and annual interest rate is 10% and if you are going to save for 15 years, then you pay PRINCIPAL OF 18,00,000 rupees. After 15 years, you get interest of 23,47,743 rupees and maturity amount in 41,47,743 rupees.
Financial Investments with RISK:
Trading Mandatory: Few examples are Stocks, Exchange Traded Mutual Funds, Futures, Calls and Options, ULIPs (you don't trade but switch from one fund to another fund), ETF etc. When you invest in "Financial Investment with RISK" like STOCKS or Index Based Funds, you get profit of more than 15% each year on a longer term. That's what history says from 1990. When we compare this 15% profit as interest gained, then with the following calculation, you can know that more profit is available in Stock, Mutual Funds, and Indices etc. If monthly installment is 10,000 rupees and annual interest rate is 15% and if you are going to save for 15 years, then you pay PRINCIPAL OF 18, 00,000 rupees. After 15 years, you get interest of 48, 46,210 rupees and maturity amount in 66, 46,210 rupees.
When you compare Savings without RISK on a Longer Term and Financial Investments with RISK, the later has got more benefits.
Examples of Financial Products traded in Indian Exchanges:
- Stocks (Cash), Stock Futures, Stock Options: TCS, State Bank of India
- Index Futures, Index Options: example: CNX Nifty, Junior Nifty
- Commodity Futures: Gold, Silver, Jeera, Pepper
- Currency Futures, Currency Options: USDINR, EURINR, GBPINR, JPYINR
- NSEL series: e-Gold, e-Silver, e-Platinum
- Mutual Funds: SBI Blue Chip Fund, Franklin InfoTech Fund
- Exchange Traded Funds: Nifty Bees, Junior Bees
- Interest Rate Derivatives: FUTIRD
- Bonds: HUDCO, SBIN
- Gold Traded Funds: ReligareGo, HDFCmfgetf, AxisGold, IDBI Gold
If you want to do trading by your own successfully:
- Learn about financial markets
- Watch the local trends and national trends
- Be Strong in fundamental and technical analysis
- Gain the confidence to trade when you face losses
If you are not sure about the market scenario, get stock tips, commodity tips, future tips from companies and start trading.
eTrading or Online Trading
Stock Options Commodity Tips