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Investments and the need for investments
• Some of the money earned is spent and the rest is saved to cover future expenses. Instead the savings go unused you may want to use savings to get that income the future This is called an investment. • You have to invest
1. Monetize your unused resources
2. to create a certain amount for a certain purpose life
3. Book an uncertain future
When should you start investing?
• The earlier you start investing, the better. Factor:
by investing early, you give your investments more time
grow, increase your income by collecting
capital and accrued interest or dividends,
year after year.
• The three golden rules for all investors are:
1. Invest early
2. Invest regularly
3. Invest for the long term and not the short term
Where to invest
• Can be placed:
1. Physical assets such as real estate, gold/jewellery,
goods etc
2. Financial assets, such as term deposits in banks, small
save post office equipment,
insurance/insurance/pension fund etc or securities
market related instruments such as stocks, bonds etc
Short and long term options
For investments
• Short term:
1. Savings bank account
2. Money market or liquid funds
3. Term deposit in banks
• Long term:
1. Mail saving
2. National fund
3. Obligations
4. Investment funds
Before investing in the market
• It is always wise to learn the basics before investing
of the stock market. We prepared articles and
Tutorials on the basics of the stock market. Also included
here is an explanation of stock exchange terms and jargon
used by people involved in stock trading and
stocks Let the Bombay Stock Exchange (BSE),
National Stock Exchange (NSE), London Stock Exchange
Stock Exchange (LSE) or New York Stock Exchange (NYSE),
conditions or more or less similar
Why trade on the stock market?
• 1. Unlike shopping, you don't need a lot of money to start earning
real estate and monthly mortgage payments. • 2. It takes very little time to trade - unlike traditional construction
business
• 3. It is "quick" cash and allows quick liquidation (you can convert to cash
as opposed to selling real estate or business).
• 4. Learning how to earn from the stock market is easy.
But you have to get the basics down. If you don't... you're wasted
a waste of your time and money. You need to be crystal clear about each
investments, stock options, stock trading, company, shares,
Dividends and types of stocks, bonds, securities, mutual funds, IPOs,
Futures and Options What makes up the Stock Market? exchange,
Indices, SEBI, Stock Analysis - How to Check What to Buy?, Trading
Terms (limit order, stop loss, sell, call, book profit and loss, short and long), trading options - brokers, etc.
Types of Investments:
Stocks: Ownership shares in a company. Purchasing a company's stock grants you shareholder status and a portion of the company's ownership. Stocks have the potential for significant returns but are also subject to high volatility.
Bonds: Debt securities issued by governments or corporations. When you invest in bonds, you are essentially lending money in exchange for periodic interest payments and the return of the bond's face value upon maturity. Bonds are often considered a safer investment compared to stocks, although they offer lower potential profits.
Mutual Funds : Investment vehicles where multiple investors pool their funds to create a diversified portfolio of stocks, bonds, or other assets. These funds provide diversification and professional management.
Real Estate: Investing in properties, such as residential, commercial, or industrial, to generate rental income or capital appreciation. Real estate can offer stable income and potential profits through property value appreciation.
Cryptocurrency: Online or digital currencies that utilize advanced cryptography techniques for secure transactions. Cryptocurrencies like Bitcoin and Ethereum have gained popularity as alternative investments, despite their high volatility and speculative nature.
Retirement Accounts: Accounts such as 401(k)s and Individual Retirement Accounts (IRAs) that offer tax advantages for retirement savings. These accounts typically provide various investment options.
Savings Accounts and Certificates of Deposit : Low-risk, interest-bearing accounts provided by banks. While these accounts offer principal security, the returns are generally lower compared to other investment options.
Commodities: Investing in tangible assets such as gold, oil, or agricultural products. Investing in commodities can act as a hedge against inflation and economic uncertainty.
Type of investors
• Hedger
• Arbitrager
• Speculator