This is Most Common question that occurs among youngsters: “ How Much Money I Needed to Start a Career in the Stock Market”.

Investing/Trading Mostly depends on what is your end goal and your risk tolerance.In this article I will explain each and every point to start your wonderful journey in Investing/Trading.

So Firstly we understand the difference between Investing and Trading.

Trading:- Trading involves buying and selling of shares and derivatives in a very short period of time like in a day or in minutes.Traders want profit in a very short period of time but it is very risky without prior knowledge and experience.

Investing:- Investing involves buying and selling of shares and holding it for a long period of time like Years or decades. Investing gives stable profit and growth according to the future growth of the companies in which you have invested.

Minimum Amount Required for Trading

There is no word minimum in the stock market but as a beginner you come with a very little amount and practice with that amount to have experience with actual money. Here we will discuss the few factors 

1. Broker Account 

You need a Demat Account to Trade and Invest in the stock Market. To trade we have two types of broker

a.Full Service Broker:- They provide Research Reports and Advisory services like ICICI direct,HDFC securities but they charge higher.

b.Discount Brokers :-   They Don’t give much extra services like zerodha and upstox but they charge less than full service brokers.

2. Brokerage Fee

Discount brokers charge 10 to 20 rs for a trade while full service brokers charge 0.01%   to 0.05 % of the trade.

 3. Price of Stocks

  Price of stocks starts from 1 rs to Lakhs invest according to your knowledge and risk appetite.

Minimum amount Required For Investing 

As you know there is no word minimum in stock market but you can monthly SIP as low as 500 rs Per month. If you want to invest with yourself then it is recommendable to invest 5000 to 10000 rs.

Let we take example

If a share price is 100 rs and you want 10 shares of it.

Then you need 100*10=1000 rs + brokerage charges

And start your SIP with 500 rs.

And you invest in ETFs with 100rs. 

Then you need approx 1600 rs + brokerage charges to start investing in the stock market.

It is advisable to start investment with 5000-10000 Rs.

Points to Remember in Stock Market

1. Risk Tolerance  

 Always start with a small amount and invest in blue chip stocks,Do not invest money that you need in the near term.

2. Financial Goals

If you want long term growth start with a small amount for a long period of time but if you want short term profit but trading risky do not start trading without prior knowledge and experience in stock market.

3. Diversification

If you have 10000 Rs to invest in the stock market then instead invest in one share invest in 5 shares like 2000 Rs in each share. So that risk is distributed among shares.

4. Emergency Fund

Before starting investing and trading you have at least 3 to 6 months of living expenses for you and your family. Avoid investing money that you need in a short period of time because the market is volatile. Sometimes you may need months to recover the losses. And you have to be patient to recover those losses.

Tips For Beginner

1. Open a Demat Account according to your needs.
2.  Start with a small amount first to understand the market behavior then come up with a bigger amount.
3. First Focus more on learning and research before starting investing or trading .
4. Always Review Portfolio and adjust shares according to your knowledge and market behavior.
5. Start investing in mutual funds if you are busy and don’t have time to manage a portfolio.

 Conclusion

 Stock market is a business not a “Alladin ka Chirag” that gives profit all the time. So Invest wisely or start SIP as low as 500 Rs. Slowly and steadily you can grow your trading amount. Remember whatever amount of money you want to invest with Firstly just focus on learning, practice, Diversify your portfolios and a Disciplined Mind Set, Now You can open a Demat Account and Start Your Wonderful Stock market journey.

Happy Trading!!!