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Friday, July 19, 2024

Stock Investment in India 

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Stock Investment

It is a thing of the past now that the stock investment in India was limited for the elite few or for individuals who had extra-large sum of money. The new day and age has witnessed a certain trend change in this regard where very many people have started investments and stock investment seem to have gotten the best of this mentality.

Stock Investment in India 

Investment is a long practice that may assist anyone regulate their money. Stock trading can be intimidating, particularly if you are just getting started, because it may look excessively difficult or hazardous. An in depth research or a professional assistance will help you on your way to your fist stock investment.

Stock Market

A legitimate market place for investors to purchase and sell their shares has been formed to encourage public exchange. A stock exchange is a platform where stocks are openly issued and sold. A stock is an instrument that proves your ownership in a firm, and you may transfer it to anyone. The stock market provide the means to legitimise a stock investment.

Investing in Stocks

Stock investments in stock exchanges are fairly easy given the certain basic requirements are met;

  1. Necessary Documents for Investing in Stocks such as PAN card, Aadhar card, a Cancelled cheque of investors’ name, address proof, income proof and passport size photos.
  2. Demat Account – A Demat account is created to hold the shares on behalf of the investors.
  3. Trading Account – When a Demat account is created a parallel trading account is created to trade in stocks which in turn is linked to your bank account for ensure cash flow.

The stock trade in India happens in two stock exchanges – The Bombay Stock Exchange and the National Stock Exchange, with the same trading mechanism and, hours and settlements. Primarily there are two major market indexes Sensex & Nifty. 

Why Demat Account Opening is increasing in India?

With Covid uncertainities in 2020, which showed in the slow and wary investments made in the market, the later part of the year showed promise and in fact brought more new investors into stock investment.

Given its basic nature, stock investment required Demat account and hence this resulted in increased number of Demat Account opening in India.

In fact the number is at its all-time high with the number of people dabbling in investment, especially stock investments, have grown exponentially.

2021 figures show a huge rise in the number of Demat Account, which was almost twice of what 2020 had.

Growing economies such as India is quickly proving drivers of further expansion. Today, just a small portion of Indians’ domestic savings are invested in the domestic stock market, but with GDP expanding steadily for the previous few years, the financial environment thus created encourages new investments made in the market. 

Stock investment open up avenues to get more interest on your invested sum and also encourages a healthy systematic investment discipline which only benefits in a long run.

Investment in equities, for example, has resulted in a greater rate of return over the previous decade when compared to fundamental saving products such as fixed deposits. Periodic investments instil a financial discipline habit, motivating you to save and invest wisely.

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