What is the best way to make money from the stock market. Everyone wants to know this but do you know that the stock market is not a game.it is a very big Business that we have to learn and very hard work so people Anyone has to know about the share market we will have to learn and understand.
The stock market is a market in which shares of companies are bought and sold millions of people do Share Market as a full time job in which they analyze companies and the company whose shares are being received at a lower price. They buy the stock and when the price of that company’s share increases they earn profit by selling it.
People know it by many names like share bazar, stock market, share market, equity market, wealth market, but the work of this market is the same and that is how to make money in this market people earn millions and crores of rupees in minutes and They also get destroyed because there is a lot of danger in this market. But if you have a good knowledge of this market then you can easily earn millions of crores of rupees.
10 Ways To Earn Money By Trading In The Stock Market
1. DAY TRADING / WHAT IS DAY TRADING
Indian stock market opening time is 9:15 am while closing time is 3:15 if you buy or sell a stock at the same time interval then it will be considered as day trading or intraday trading. you have bought the shares of a company today and sell it today then it is called intraday trading whether you have profit or you lose. This is very risky because out of 100% people only 10% of people make money in intraday trading.I live in because intraday trading is an art. it is an art that has to be learned and it takes 2 to 3 years of work to learn it
Benefits Of Day Trading
- Profit or loss on the same day : If you are doing intraday trading by doing research and analysis, then you can definitely take advantage of it. Sometimes stocks run from 20% to 30% on the same day and you can in the same day Can earn 20% to 30% profits
- We can buy more shares for less money : It is also a good feature in intraday trading that in which you can use margin money, margin money means if you have 10,000 rupees in your trading account and your broker will give you 10 times limit. 10000 × 10 = 1 Lakh, you can use a margin at ₹ 10,000 and take up to 1 lakh goods.
- Less brokerage is required : Intraday trading or day trading you have to give less brokerage while in delivery you have to give more brokerage
2. SCALPING TRADING / WHAT IS SCALPING
Scalping trading is also a part of intraday trading and the trader we call a scalper buys and sells a large quantity of shares in a few seconds or few minutes if the price increases or decreases and tries to make a profit. In this the trader does not wait for the whole day. A stock is sold for a few seconds to a few minutes and small movements that come in the market are taken advantage of and a lot of trades are done till the market closes. Scalping Trading is a trend following strategy trades are made in the same direction in which trend is made big money is invested in Scalping and small profit is drawn.
Scalping Trading Important Points
- High Volatile Share is selected for scalping and 1-5 Minute Charts Price Action, Chart Pattern and Trend line are used for scalping. Indicators are not generally used.
- Scalping Trading is one of the most difficult trading strategy it requires a lot of skill to do it because Quick Action is required in this, the stock has to be bought and sold in a few seconds to a few minutes.
- To succeed in Scalping Trading in the Share Market requires a lot of discipline as a wrong trade can eliminate the profits of many small trades.
- Scalping traders trade up to 10 – 100 a day due to which their broker has to pay a lot of brokerage so a Scalper should take Right Trade at Right Time and try to save brokerage.
3. SHORT SELLING TRADING / WHAT IS SHORT SELLING
Short Sell is done in the falling market. To Sell Short the trader first sells the stock at a higher price and later buys back the quantity of the stock he has sold and if he sold it at first expensive and If you buy it later then it becomes profitable but in Short Sell you cannot keep the trade for tomorrow because you have to buy it the same day you have sold it. it is called Short Sell.
Short selling is the sale of shares that you do not hold in a demat account. Which do not belong to you. These stocks are borrowed by the broker and the broker is promised that after some time these stocks will be returned to him. After borrowing these shares are sold and the money received is credited to the account. If the price of the stock you sold falls So you can make a profit by repurchasing them.
Even if the prices of these stocks did not decrease and kept increasing for a certain time, you still have to buy them and you lose. The shares are then returned to the broker. In this way we can say that short selling is a strategy to invest and make profit.Under which the shares are borrowed from the broker for a fixed time and they are sold at a higher price and bought at a lower price and these shares are returned to the broker again. If the price of the shares does not decrease then you lose.
Benefits Of Short Selling
- Provides liquidity in the market.
- Helps in price correction of most stocks.
- Traders can also make money in recessionary markets.
- Positions may be taken at the margin.
- Securities can be sold at a better price leading to profit.
4. SWING TRADING / WHAT IS SWING TRADING
When a stock is held for a few days a few weeks or a few months after it is bought and the stock is sold after the price increases this kind of trading is called swing trading. You should have a good knowledge of that because if you have bought any of your shares today and tomorrow or the day some news came that caused the price of that share to go down a lot, then you may suffer a lot of loss.So to do swing trading you must have advanced knowledge of advance
Benefits Of Swing Trading
- This form of trading offers good returns of about 5% – 10% which can be earned in a very short or medium term. It has a shorter duration and better returns than other traditional methods of investment.
- Secondly it does not require you to sit at your computer all day or continuously like intraday trading. In swing trading you can also trade with your full time job but in intraday trading. it is impossible to focus on anything other than stock market.
- Like intra day trading in swing trading you do not need to spend a lot of time in search of the right trade to make a profit. Once you start a trade you can work with them for a few days or weeks. But in such cases the holding period is slightly longer than the others.
5. POSITIONAL TRADING / WHAT IS POSITIONAL TRADING
When a stock is bought for a few weeks or months and thus sold after holding the stock for a few months, then it is called positional trading. In this, you must have knowledge of advanced labels to trade.Share bought for Positional Trading is generally sold within a year and profit is earned by taking advantage of the long movement that comes within the stock price this is called Positive Trading.
Benefits Of Positional Trading
- Easy To Implement: There are mainly four types of trading styles in a stock market. Scalping, Intraday Swing and Positional Trading are easy to compare to all these trading styles. Positional Trading is easy to use Simple Candlestick Chart and Moving Average in Position Trading Tax Share can be found out where to buy and where to sell.
- Part Time Trading: Position Trading can also be done in part time as it involves less trades due to which there is sufficient time to analyze the stock and place the trade. A good profit can be made by doing position trading part time.
- Volatility: Stocks purchased for positional trading have low volatility and intraday volatility does not affect Positional Trading’s Stoploss
6. OPTION TRADING / WHAT IS OPTION TRADING
Traders have some trading options. There is a monthly series of option trading. Its expiry is on the last Thursday of every month, there are also weekly options of Nifty and Bank Nifty index whose expiry is on every Thursday.These options can be bought and sold at any time before the expiry date. The option has an expiry date lot size and a srike price. Options are traded in 2 ways – by buying (buying) an option and making an option seller
Often the option seller is the only one. But the option seller gets higher margin money. The amount of money that an option buyer has to take by multiplying that price by the lot size of the srike price that he takes to buy 1 lot. But on selling the option of the same strike price, the additional amount as security has to be deposited with the broker.
Benefits Of Option Trading
- Estimation: Options trading is an effective way of estimating. By using option contracts traders can earn huge profits and limit their losses as well.
- Income from Existing Portfolio: Investors who hold securities for a long period can also earn income on their holdings by writing option contracts but it is very risky. But if it is not handled well, it can give more premium than normal income.
- Leverage benefits: Options help reduce the significant reduction in contract cost. Which is attractive for small budget traders. Generally the cost of the investment required to trade in option trading is 3-4% of the investment made in stock trading.
- Tax Management : Option trading also helps a lot in managing taxes as the tax paid on the entire capital gain is much higher than the tax paid on the premium only.
7. FUTURE TRADING / WHAT IS FUTURE TRADING
Future contract means that you promise to buy or sell an underlying security at a future date. And that too at no cost.When choosing a stock or index for the future you do not have to pay its full value trading can only be done by depositing margin money (10 -15% of the total value). Future cash markets trade at a premium or discount.Trading in the market for less money is possible through futures.Margin determines the exchange. Future trading is for a month. Traders can also rollover their deal for the next month if they wish. In the future trade, every day there is a book of profit and loss. In case of loss the broker has to compensate the trader. Future trading takes place in both index and stocks.
Trading in the stock market for a little money is possible through futures. Future is traded in index or stocks. Trading can be done only after depositing margin money in the futures market. The index and the margin of each share are decided by the exchange. Future trading is for a month. Its expiry takes place on the last Thursday of the month.
Every day the profit and loss is calculated. The trader has to compensate for the loss. Trade in the future is the job of experienced traders. One should not trade in the future without experience. Many traders also use futures to hedge their portfolios.
Benefits of Future Trading
- Leverage due to the provision of margin trading : Using a margin trading account, positions can be taken in the future market by paying only a fraction of the total contract value.
- Liquidity : The number of future contracts traded every day is quite high so the future market is very liquid.
- Lower brokerage costs and commissions : The brokerage and fees charged on future contracts are quite low so the investor does not have to pay a large amount in commissions.
- Hedging : Future trading is a very important mechanism for hedging or diversification of portfolios and risks. In particular, in the foreign currency market and interest rate market future trading helps a lot in reducing risk due to price fluctuations.
- Short Selling : There are many restrictions on short selling of shares in person but short-selling of a future contract is legal and the investor is able to sell the future contract to get less exposure to the stock.
- Fair and easy to understand : Future trading is simple and easy it is not as complicated as option trading
8. ARBITRAGE TRADING / WHAT IS ARBITRAGE TRADING
The Strategy of making a profit from the difference in the price of assets in two different markets is called arbitrage (ARBITRAGE). Under this strategy the arbitrator buys assets from one market and is sold at the same time in the other market for the purpose of making a profit. This strategy allows arbitrageurs to benefit from the difference in exchange rates.
This strategy is done through the equity market and the derivatives market. The price differential is taken advantage of in the cash market and the derivatives market. The risk is relatively low. Because in this an asset in the spot market takes a long position while in the derivatives market it is replenished by a short position in the same asset.
Benefits Of Arbitrage Trading
- These funds are less likely to lose
- Due to the small size of the arbitrage fund And its management is easy.
- Most deals are done through algorithmic trading.
- In the event of a lot of upheaval in the market these funds have the highest profits.
- Investors who cannot afford to invest directly in shares can choose these funds
9. FOREX TRADING / WHAT IS FOREX TRADING
Forex market is the market where foreign exchange or forex transactions take place. It is a global and decentralized market where currencies are traded. Each of these currencies has a conversion rate known as the exchange rate. For example if the exchange rate of EUR / USD is 1.10, it means that 1 euro is equal to US $ 1.10. Forex is one of the most liquid markets, with a daily transaction volume of $ 5 trillion.
It is mainly used to facilitate operations and investment between countries.The foreign exchange market is open 24 hours a week except for weekends opening in Sydney on Monday morning and closing in New York on Friday evening.
Benefits Of Forex Trading
- No fees or indirect commissions
- 24 hours market operation
- The ability to trade dozens of currency pairs
- Popular leverage to maximize your profit opportunities
10. COMMODITY TRADING / WHAT IS COMMODITY TRADING
Commodity Trading is very very successful trading in india. This is one of the most developed forms of trading in India. After equities, real estate and precious metals like gold and silver, people have started investing in commodities as well. This is the new avenue for retail investors and traders to participate.Although commodity trading has its own risks and challenges it is also a rewarding platform that helps traders earn good profits in the process of buying and selling online commodities.
But like other forms of trading commodity trading also requires a lot of hard work, knowledge experience and dedication.Traders should be well aware of the commodities markets and world economy which causes price fluctuations in the commodity. Traders must know fundamental analysis as well as technical analysis to be able to take the right steps in the commodity trading market.
Benefit Of Commodity Trading
- You do not need to open a new account separately to open a commodity account. You can do online trading by adding a commodity to your demat trading account. (For this it is necessary to submit income proof)
- You can make commodity investments both online and offline.
- The price of a commodity market is the same in the whole world.
- Investing in commodities brings different types of stocks in your portfolio holding so that your holding is balanced due to the bad times of the market.
- Commodity investments can give you good returns during the period of inflation.
- A commodity is traded at a fair price and a low brokerage price.
- After equity market, commodity trading is also a trading investment throughout India.