Investors are continuously losing money in the stock market. In just 7 weeks, investors lost Rs 50 lakh crore in the Indian stock market. Nifty and Sensex are about 10 percent below their all-time high. If you are trading in such an environment, then you should take care of some things. Let us tell you today about those 5 mistakes, by avoiding which you can avoid losses in the stock market.
Understand the stock market before investing /p>
If you invest or want to invest in the stock market, then first of all you should have complete information about it. That is, how the market works, what are the technical terms of trading and where and how investments are made. Apart from this, investors should keep an eye on every news related to the industry and market. This not only tells us which shares should be bought, but also tells us when to buy and when to sell a share.
Do not be careless about shares. strong>
If you are investing in the stock market, then you should pay full attention to the selection of shares. Choose different types of shares for both long term and short term investments. To do this, you can look at their fundamentals or talk to a market expert on this. To see the fundamentals of any stock, you can login to websites like screener.in, nseguide.com, equitymaster.com, bigpaisa.com.
Keep diversification in the portfolio
There is a saying, "Don’t put all your eggs in one basket." The same applies in the stock market also. The principle of diversification is very important to avoid losses. That is, whenever you invest in the market, invest your money in many shares or in shares of many sectors. This will reduce the risk and if there is a decline in any sector or share, then this loss can be covered by the profits of other sectors.
Focus on long-term investment p>
Many investors do short-term trading to earn quick profits in the stock market. But this method can be fatal, especially in the current market condition, if short-term trading is done then the possibility of loss is highest. If you make long-term investments instead of short-term trading, not only can you avoid market fluctuations, but there is also a possibility of good returns.
Market sentiment Understand
In the stock market, many times investors take hasty decisions under the influence of market sentiment. Especially when the market falls. Like, what is happening with the Indian market in the last few weeks. Seeing the decline in the market, many people get nervous and sell their shares. If you are in profit then many times this decision proves to be right. But, if you are in big loss and booked loss out of panic then it will not be right for you.
Actually, the way the market goes up, it also corrects itself in the same way. . At such a time, you should take a decision thoughtfully. If you have invested in a stock and its fundamentals are good and the company is doing well, then you should average it at the time of decline and not sell it. Disclaimer: ( The information provided here is for informational purposes only and it is important to note that before investing any money in the market, one should always take advice from ABPLive.com. is never advised here.)
Also read: This share came down from Rs 138 to Rs 10, people are buying it heavily, upper circuit is imposed.
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