Are you new to share trading? Do you want to know how to learn share trading online? Do you want to become a professional share market trader?
In this article, we will discuss the basics of share trading. In addition to the best ways to learn share trading like a pro.
Share trading may seem like an activity of chaos. However, it an efficient process that utilizes the buying and selling of securities. Before you make an investment through shares, you have to understand them. The first step to become a successful share trader is to understand:
- what is share market
- important share trading terms
- how to trade in share market
But, before we get into how to learn share trading -lets understand the what is share trading and how it works.
Learn Share Trading Explained
Share trading is a technique to build wealth. The process of trading shares has become a common word. You may have heard the jargon enough times. But What is share trading?
When you trade shares, you are buying or selling a company segment in the financial market. This process is also referred to as a “stock exchange“. Each share has a value. While a share value determines the company existing performance. However, future performance can impact share price as well.
What is Share Market?
A share market is a place where traders can buy & sell ownership of investible assets. These shares trade on a stock exchange or over the counter.
Shares are also known as stocks and equities. They represent fractional ownership in a company. However, share market efficiency functioning is critical for economic development. Because gives companies the potential to access capital from the public in a short time.
Learn Share Trading Basics for Beginners
Share trading for beginners can be a bit overwhelming. Trading is a lucrative opportunity to make money. But it also involves the risk of losing money. Because of market volatility.
Whether it is the National Stock Exchange (NSE) or Bombay Stock Exchange (BSE), it is always important to learn share market jargons to get started. Here is a share trading glossary you must learn before getting started before you join a course.
- Blue Chip: A blue-chip company is with a national reputation for quality, reliability, and ability to generate profits. For instance, Commonwealth Bank, Telstra, BHP Billiton, SEBI, Reliance, and more.
- IPO: An Initial Public Operating (IPO) is the very first stock sale used by a company to the public.
- Income shares: Income shares is a class of capital stock offered by a company that pays a dividend to shareholders.
- Growth-Share: Companies that re-invest profits for long-term growth:
- Rights Issues: A right issue is a dividend of the company right to buy additional securities at a discounted rate.
- Market Capitalisation: It is a term used to define the market value of a public traded company outstanding shares.
- Bull Market: A bull market is a sustained period when the stock market value is growing.
- Bear Market: A bear market is a market condition when the securities price is failing.
- Day Trading: Day trading is an act of buying and selling securities within the same times. Indeed, is a stock trading strategies where shares are purchased for short-term capital gains.
- Sectors: A sector is a similar group of companies. For instance, the agriculture sector is comprised of pesticides and agro shares.
- Capital Growth: Capital growth is a situation when an asset increases in value over time.
- Settlement Date: A date when a person has to make payment for trade purchased.
Know as you have master the share trading basic terminology. Its time to learn about share trading in depth. Learning the share trading basics will help you to understand trading easily.
Let’s see how a beginner can learn share trading.
5 Steps to Learn Share Trading
Share trading is an excellent way to grow wealth. But for beginners share trading can be daunting? Follow these basics steps below to learn how to trade shares in the stock market:
- Get Educated: The initial step toward becoming a competent share trader is gaining knowledge. IFMC Institute is the best institute to share training courses in India. The institute offers both free and paid share trading courses. The courses are very affordable and easy to understand for the common man. The course curriculum is based on the latest industry standard.
- Choose an Investing Style: There are several approaches to share trading. Comprehensive training in share trading will help you build your own investing style. Everyone likes free online courses for share trading. IFMC Institute offers one-to-one free lessons.
- Fastrack your Learning: Here comes an alternative to free courses including in-person classroom classes and online courses. For premium online trading, training can join the IFMC stock market course for traders. Going for online premium courses will help to learn faster and can get hands-on higher-quality content. Thus, you can save time and money. Similarly, a classroom stock market course for traders offers a facility of a mentor. A mentor will guide you with practice on live trading sessions
- Choose a Share Trading Method: The two basic share trading methods are Electronic Traders and Exchange Floor Traders. Electronic trading is an online mode of trading. Whereas floor trading is an offline mode of trading.
- Avoid Trading Scams: Avoid being a part of an investment scam. It’s easier than you think for scammers to take your hard-earn money. In fact, investment scams come in a different form, besides, the internet has made it easier. Thus, formal education to analyze investment scams can help you avoid uncertainties.
How to Make Profits from Share Trading?
As discussed, share trading is a way to create wealth. Here are three way to make money through share trading:
- Capital growth: Capital growth is a common way to make money from share trading. This is simply when you sell shares from more than you paid.
- Dividends: Another way to earn profits is through Dividends. This is when the company directors choose to pay company profits to shareholders. Although, Dividend payments are the basis of the number of shares you own. This type of shares is referred to as income shares. Moreover, not all companies pay divides, thereby, the directors can reinvest profits rather than paying a dividend. These types of shares are called growth shares.
- Tax benefits: A share can be stamped officially. You can also use franking credits in order to reduce the tax on other income.
What are the Benefits of Share Trading?
- Share trading allows investors to make money in both short-term and long-term. Additionally, it offers a provision to save tax.
- Share is a liquid investment, thus, an easy way to get your money in two days after you make a trade.
- Shares are a proven way to invest for long-term capital growth.
- Receive a capital gain tax discount after holding on to the shares for more than 12 months.
- As a shareholder, get the right to vote in company decision and attend annual general meetings.
What Else You Need to Learn?
If you’re planning to manage your own investment and make an independent trading decision, you need to learn the following concepts:
- How to set stock prices?
- Ways to understand stock quotes?
- How to determine a stock value?
- How to protect stock profits?
- Things to avoid investment scams?
Best Share Trading Course for Beginners in India
Share trading course for beginners gives you the flexibility to learn share trading. It is a must-do program for traders. Become a stock trading expert with IFMC Institute. IFMC is an award-winning institute for Stock market education. During the course, You get knowledge of Intraday Trade and Options Trade. Students looking for an NSE, NISM, NCFM certification can also apply. After completing this course students can pursue a career in stock market India.