Why Some Investors are Only Successful in Stock Market

Due to surge in the technology, many investors/traders are opening fresh demat a/c’s and testing their luck! Although it is a welcome-note, not all investors are getting success in the stock market. Do you know the reason why?

New investors are entering the market without analysing their risk profile and without understanding the basics of the stock market!

Yes Stock Market has the potential to give huge returns, but is anyone researching how is it possible? They enter the market with the tips of the stock brokers. They blindly follow them! Especially retail investors enter the market without basic knowledge, they just follow the advice of their friends and relatives which goes to ruin your wealth in the short-term.

By seeing short-term losses, they conclude “stock market is gambling”! If stock market is gambling why legendary investors gain huge wealth in stock markets?The answer is Simple- “They don’t purchase any shares in hurry; They spare some time in understanding the fundamentals of the stock and if they think if the stock would do better in future, then only they will take a buy call. In their research they also analyse the technicals based on the current market situation and they decide whether to buy or sell”

It is a continuous process for successful investors to do research on the stock prices and after concluding that the stock would perform better in the coming years,then only they purchase shares of that company

But retail investors do the opposite; they enter the market on the stock broker tips or on the advice of their friends and relatives and purchase shares blindly without researching on the company. They don’t even estimate why stock brokers are repeatedly offering “Buy Calls”.

The hidden fact behind stock brokers recommendations is that they earn commission on the investors invested amount. It will earn huge brokerage to the stock brokers.

Even though Caveat Emptor(Let the customer be aware)applies in stock market too, retail investors should be aware of the risks involved in trading and do sufficient research before investing! There is no good time or bad time in the market! Do your own research, understand the basics, analyse your risk taking capacity and decide to buy or sell the stock. Do remember no one is responsible for your gain or loss in the market! Only your sole decision will decide your success rate in stock market. Your Research plays a critical role in your success.

In today’s digital world, every company’s financial position is at your finger tips. It is just a click-away to do research on the company’s growth. Legendary investor warren buffet reads each and every financial statement of the company and as per his own analysis, he will make buy or sell call. So he created huge wealth in the stock market.

If you want to be like warren buffet, start reading financial statements, balance sheets of the company and if you assume the company would grow in future, then buy that share. Doing own research is the only mantra to earn huge returns in the stock market

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