What are Shares?
Shares are a unit of ownership interest in a company. When you buy shares, you are buying a part of that company. While owning shares in a business does not mean that the shareholder has direct control over the business's day-to-day operations, being a shareholder does entitle the possessor to any profits, if any are declared in the form of dividends or capital growth through the value of your shares increasing.
1. Learn as much as you can about investing
Before you commit your money to the stock market, it’s best to understand how the stock market works and get educated in the area of investing. Consult a licensed Stockbroker/ Investment Adviser for advice and follow up on stock market reports and other announcements disseminated by the Exchange.
2. Invest with small amounts of money
Investing with a small amount of money is the best way to start off for the first time because it lets you get a feel for the stock market while keeping you safe from any major losses. You can invest small amounts in shares quite effectively because the cost of doing so is low compared to many other investments.
3. Don’t invest what you can’t afford to lose
This is a golden rule. Even if it’s a small amount, the money you invest should not be the money you rely upon in your daily routine. Use your surplus funds to invest.
4. Try not to let your emotions control you
Don’t get driven by investor sentiments. Investments based on emotions leads to speculation rather than intelligent investing. Try to build discipline so that your emotions do not cloud your mind.
5. Embrace your failures
Don’t look at your failed investments as a means of discouragement, instead look at them as lessons. Take these failed investments and analyze them to see what you did wrong, so that you can form a list of rules to invest that will help you to never repeat these mistakes again.