hey guys hi hello welcome to another
episode today and today's episode is
called how to invest in stocks for
beginners now if you guys are not
beginners and you already know how to
invest in stocks i think this is not the
video for you guys because this is for
people who have no clue who have no idea
who just entered the stock market who
just turned 18 or you know are going to
turn 18 and they're like you know what i
want to know how to invest in stocks
what are the different steps and
procedures this video is for them right
so for all the people who are experts
you can i think you can skip this video
this is only for uh basic guys but if
you're skipping it don't forget to
subscribe and then skip and all the
people who are
not uh seen this video before please
subscribe as well it's for both okay
i'll be little happy
[Music]
now we're gonna do a six step process
okay six step process on how to invest
in stocks for an absolute beginner
okay who has no idea cool step one
first step obviously is to open a dmat
account okay now what is a dmat account
it's an account where you can start
trading stocks right there's a broker
you have to choose a broker and you have
to start trading through that broker and
all your shares go to nhdl and cdsl
where everything is cleared and stuff
like that okay so
first gmat account now grow has a demand
account which also has zero amc charges
amc is something that you have to pay
every year it's called account
maintenance charges that has gone that
keeps going annually so grow has a zero
account maintenance charges thing and
also has very low brokerage fees as well
okay and
you can choose any other
bmat account as well not necessarily
grow but i'm just saying what grow has
because this is in the growth channel as
well okay but it's up to you but the
first step is
get a dmat account okay get a broker get
a demat account and you can do this as
soon as you're 18. okay that is the
first step now second step okay like
shashank i've done i've finished my dmat
account now what do i do there's so many
stocks here i don't know so many
different kind of financial instrument
is kind of scary i don't know where to
start okay before you even put one rupee
into investing first you need to make a
budget
okay first thing you need to do is keep
a budget aside
understand how much you're making okay
what is your incoming the revenue that
is there in your personal revenue stream
okay if i'm making say 50 000 a month or
maybe 40 000 a month understand how much
is coming in your pocket first and then
say okay shashank out of this 50 000
maybe i can save 10 or maybe i can save
20
ideally a good investor should save
anywhere between 10 to 20 minimum 10 you
have to save okay if you're not saving
minimum 10 that means you're spending
more than what you're supposed to be
earning okay either earn more or spend
less that's the only way it works so the
first thing set aside a budget and say
shashank every month okay i don't care
about the amount but it's a percentage
every month 10 15 20 i will sit and i
will invest okay before you even invest
this is what you need to do okay now
depending on that okay now you said okay
i want to invest this much now second
thing you need to decide is after
setting the investment budget aside what
is my goal
okay what am i saving for right am i
saving for the next goa trip or am i
saving to buy a car or am i selling to
buy a bike or am i saving to buy a house
which is obviously a little long term or
am i just saving for a stable secure
future right different goals people have
different goals like i want to save a
particular amount so that i go for one
international trip or something with my
friends tomorrow maybe i don't know
right so it is very important to first
align your goals and understand why i'm
investing because that investment goal
will determine your investment time
period also okay so if i want to go and
buy a house then i have to invest for at
least 10 15 years or if i want to buy a
very expensive car i have to again save
for 10 15 years if i want to send my
parents for a beautiful international
trip and i know the budget is maybe 15
or 20 lakhs then i have to start saving
from today and that would take maybe 10
to 15 years for me to save just to
ensure that my parents go for a nice
beautiful international trip okay so
after setting a set that 10 20
okay 10 20 even if you get promoted and
your salary increases or you get extra
revenue that 10 20 off that amount
should be fixed so your amount might
vary but your percentage has to be fixed
okay and then you decide how many years
do i want to keep this right do i want
to keep this until 35 or do i want to
keep this just as a backup that i want
to make a discipline of saving that's
also fine even if you don't have a goal
then your goal can be just saving that's
also a good goal to have but just don't
keep removing constantly okay and after
that once you understand this once you
understand that the third thing before
you even buy a particular stock you need
to know what is diversification it's
called portfolio diversification now
you've heard this saying don't put all
eggs in one basket
right unless you own the basket okay
don't put all eggs in one basket because
if you put all your money in say one
stock and for god knows what reason
something might happen even for the best
of the best stocks right you might buy
maybe every put all your savings into
relevance and then something really goes
bad to the reliance then you know you
can't determine your entire future on
someone else so it's always good to
split okay so portfolio diversification
basically says that ten percent that
you're investing every month or twenty
percent that you're investing every
month you invested in multiple stocks
okay multiple good long-term stocks so
that even if one goes up the other might
go down it will balance your portfolio
out because see at the end of the day
it's your money and you should be safe
okay think about it from that
perspective so
three things under setting aside budget
first thing put a nice 20 10 25 percent
budget on the side okay that's very
important
find out what is your goal for
investment if it's a
milestone based goal or is it just
simple investing goal that's also
important and then realize that
diversification is very important okay
these are the three things you even
before you even invest you start this
okay now we'll see how to invest okay
till now you understood the psychology
and one more very important thing in the
psychology is
don't go for quick short term money okay
quick gain lot of new investors in the
market today are doing that uh most of
them are investing in ipos for listing
gains okay that means they get 10 000
rupees extra 15 000 rupees extra they're
very happy and they're like yes
don't think about it from that
perspective please if you are going to
be a good investor a diligent and a
smart investor you will only win in the
long term right compounding interest
kicks in at long term you can invest
thousand today that thousand will grow
for you make money work for you okay
don't keep removing that money and just
go party and enjoy cool
awesome step three let's come to
investing in stocks now
for a new beginner okay maybe i have no
idea what stock market is okay so i
don't even know how to find good stocks
obvious common sense right i don't know
how to find good stocks i don't know
what parameters are i don't know what
ratios are uh i don't know what moving
averages are nothing i have no idea but
it's okay right you don't have to be
scared that you know i have lack of
knowledge so i'm not going to save that
should not be the approach okay there
are simple things that you can do with
zero knowledge in the stock market for
example the three ways to invest here is
okay you might know a little bit so you
start investing in your own stocks
you're like no i know this stock is good
i know that stock is good this is a
large cap stock this is a mid cap stock
maybe you know how to do that research
you can invest in that no problem these
are for people who have slight knowledge
in the market but people who don't have
any knowledge can go for a direct mutual
fund who don't have time to do this
research and who have no idea how to
start you can go find out mutual funds
online and just start investing in those
mutual funds okay there is uh
i think on very different websites you
will see a crystal rating okay crystal
rating is very important to understand
whether the mutual fund is good or bad
even the mutual fund also shows you
historical returns it tells you how much
it has given in the past how much you
could have grown your money if you had
done sap how much you would get all the
data all the information is available so
if you have no knowledge in stocks you
can't pick your stocks let an expert do
it for you just put in the mutual fund
at least you're saving right instead of
spending it okay now the last thing
third thing if you again have no idea
but we all know historically in the past
that nifty and sensex has always gone up
okay it's just an upward curve over a
period of time you can buy something
called index funds or etfs okay which
replicate the index okay so if nifty
goes up by 50
your thing also will do really well your
portfolio will do really well so you
just replicate or mirror the stock
market but if you're new to the market
three things you can do one obviously
invest in your own stocks which you have
researched if you don't know that don't
worry there are mutual funds that you
can invest really safe mutual funds
large cap preferred okay because you're
a new investor and index funds and etfs
are also a good way for new people to
invest okay now these are the three
different ways if i have no knowledge
i'm a beginner i can invest in this now
assume you're a beginner who's done some
research okay now step number four is
for people who invest in stocks by
themselves you're saying you know what
i've got little bit of understanding of
the stock market i don't want mutual
funds i've already put in mutual funds
in etf but i want to pick my own stocks
okay and you're a new person now what
happens generally a new person entering
the stock market
will always look at making money fast
okay
stock market is not a very fast quick
money making game okay you try to beat
the stock market you might get hurt in
the process rather play the long term
game okay now if i'm a new guy
completely new guy it is beneficial for
you to invest in large cap companies who
are so big it's too difficult to fail
for them like you say tcs or itc or
reliance again this is not a stock
recommendation video i'm just giving
some names of big companies that are so
big it's difficult for them to fall like
reliance and stuff like that right so it
is wise for new investors to invest in
large cap and some mid cap stocks as
well but a lot of people they look at
small cap stocks small cap means small
stocks and who have a low market
capitalization a lot of investors try to
invest in small cap stocks because
they're like you know what the price of
this stock is only 50 rupees one day
it'll reach 500 rupees i'll make 10
times my money that's what a lot of
people think right but for a stock from
50 rupees to reach 500 rupees when it's
not an established stock it is fighting
many hurdles on the way right but a
stock which is already very big right
and it's growing consistently year on
year with a certain growth percentage
that is more safer for you okay so for a
new investor i would suggest stick to
large cap and mid cap do not go for that
quick money kind of thing on small cap
okay
avoid high volatility stocks okay high
volatility stocks multiple stocks that
are hitting upper circuit lower circuit
upper circuit lower circuit okay a lot
of new investors do this okay uh avoid
that avoid penny stocks a lot of new
investors invest in penny stocks what
are penny stocks penny stocks are these
stocks like one rupee 2 rupee three
rupee four rupee stocks right and you
will be like i'll invest in one rupee
and it'll become two rupees i already
have doubled my money and you will see
if you go to youtube you might see a lot
of videos telling the five top penny
stocks of the year and you know you'll
see a lot of comments in different you
know websites saying that you should buy
this penny stock
never buy anything in the stock market
without doing your own research if just
think about it from a different
perspective if making money was so easy
everyone would have done it right that
means it is not that easy whenever easy
money is coming to you think twice okay
how's this even possible okay never fall
for that trap so
don't get into that quick you know kind
of a thing now whenever you're investing
the stock market with your own knowledge
you have to learn a little bit about the
stock market you have to learn about the
stock itself how to do fundamental
analysis of a stock how to understand
ratios how to see the sales growth you
have to check not only this year's
company's performance you have to check
last five years company performance
right you need to start reading news
articles about the country don't take
everything at face value but you start
reading about the company understand
what the company does go to their
website there's something called
investor presentation it's a beautiful
ppd that companies makes where you can
actually go inside and read about the
company so download the investor
presentation and start reading okay if
you have more time and you want to
become smarter right
start reading a company's annual report
every year they put out an annual report
so you can start reading that ideally if
you're new in the stock market and if
you want to learn and you have this
thing that you know i want to become an
expert pick one sector okay focus on one
sector and then start reading up on that
sector i just find all the stocks in
that sector and start reading up okay
this stock is like this oh i didn't even
know this existed in this market you see
how much knowledge you'll get and trust
me when i tell you this in the stock
market
knowledge is more important than
investing okay if you have knowledge you
know how to make money in the stock
market okay but run behind knowledge not
behind quick listing gains and quick
money from ipos and stuff like that okay
so learn and understand how to evaluate
stocks learn and understand how to
evaluate a particular industry and
figure out what can be the next big
thing in the next five years try to
analyze and connect the dots between
trends finance is a world wide web okay
something that happens in u.s will
affect india as well so don't just be
stuck to indian news
learn to read everything online okay
something changes in us some fed rate
hike changes in u.s indian market might
go up and down
so everything's connected okay
now
uh
these are the now you've understood if
you're a new investor and you want to
invest in your own stock you can figure
out these things you have to learn
there's no shortcut to it you have to
learn but if before you learn you can
start investing in large cap stocks
mutual funds etfs up to you okay now a
very
basic question a lot of people ask okay
when do we sell the stock
okay when is the right time to exit okay
everyone says okay this is the right
time to entry you invested in a stock
and you're keeping it for a long time
but when is the right time to exit and
this is a very very very common question
that a lot of people have and in fact a
lot of new investors as soon as they see
their portfolio up 35
they're so happy that it's up 35 that
they will take out the money
okay most of you all do that now i'll
tell you when to sell the stock firstly
if your investment horizon of saving was
for 10 years do not even touch it for 10
years if it's up 35
good for you right imagine after 10
years it would be up by 350 maybe right
so do not exit unnecessarily okay now if
you think that
you know it's gone up too much and i
want to take out the profits and maybe
invest in something else or rebalance my
portfolio right obviously if you have 10
stocks and one stock is done really well
that stock will take up the majority of
your portfolio so you can rebalance it
you can remove a little bit put it in
the other thing and keep that same you
know perspective there okay but don't
remove it don't remember to go spend
somewhere okay i've seen a lot of people
getting 35 40 game they're like
charlotte time to enjoy party time right
don't do that okay don't sell okay until
two things happen okay either you
desperately need the money for some
emergency that is why you have saved
okay that saving is for an emergency or
for a particular goal right if either of
that one thing happens you can remove
because you're like i saved for 10 years
for this exact purpose and i'm removing
it right now if there is no emergency
don't touch it let it go let it keep
compounding for let it grow for you that
money keep growing over time okay but
the second reason why would you sell
if the company's fundamentals that you
have chosen okay i've chosen this damn
good company it's amazing but you know
suddenly in that company fundamentally
something goes wrong
okay really wrong fundamentally okay
their whole business plan has changed
and it's just going into a bad track or
you know the sales have dipped not a
small dip if one sales have dipped in a
small period because of some sentimental
news doesn't matter because the
fundamentals of the company need to be
strong suddenly two three plants have
shut down that is when you exit and
you'll be like okay i need to find one
more now okay this is gone from my
portfolio out of the stocks that i chose
fundamentally this stock has gotten bad
let me find another stock it is very
difficult for a stock to be
fundamentally good
for 30 years think about it right so it
might go wrong so until that don't
remove
okay the main reason keep thinking the
main reason you've invested in the stock
is for long-term gains right so that
over 10 years 20 years 30 years and you
all see these infographics online right
you see these images where it said if
you had invested in itc 25 years ago
this would have been your net worth and
you'll be like wow that is so good but
how many of y'all can actually keep and
hold it for 20 years but i agree that is
when the gains actually come if you keep
it for a long period of time but it is
very difficult for us to see it and keep
it for 20 years and go through that and
that discipline
not many people can do and the people
who do it obviously end up making good
long-term wealth gain okay so do not
sell the stock until you really need the
money okay or until you feel that
fundamentally something has gone wrong
okay that's when you sell the stock or
else if you don't need the money what is
the point of removing it and spending it
somewhere rather let it be and grow you
spend with the remaining eighty percent
of your income twenty percent you save
remaining eighty percent of your income
to enjoy life is more than enough okay
cool
now last step step number six and this
is the most crucial step in my opinion
for the young new beginners is that once
you've learnt all this don't stop
okay the step number six for me is keep
investing continue investing okay
whether you want to do an sap whether
you want to manually invest every month
whether you want to invest little this
month maybe more next month does not
matter but continue this discipline of
investing month on month time on time
and wait
wait for that perfect time you will see
don't expect you're investing every
month and you'll be like should it's
been three months i've not got much
gains only six percent only seven
percent it takes time but it takes a lot
of time for you to get make a lot of
money in the stock market but what
you're not understanding if you keep
looking at six seven percent your corpus
is building every month i'm investing 10
000 assume or every month i'm even
investing 5 000 right there's no minimum
investment to start even if you start
with 100 rupees it is considered
investment it is good start saving from
day one make a habit don't think about
how much i'm saving make the habit of
saving okay every month on this day
particular day i start saving ten
thousand ten thousand ten thousand every
month in a year becomes one lakh twenty
thousand that same amount in five years
becomes almost six lakhs which is insane
okay no yeah six lakhs don't become six
lakhs in five years so keep saving keep
saving even if it's five thousand or ten
thousand a month does not matter just
keep saving constantly okay so that is
my most important thing now
apart from these six steps for new
people to invest i'm gonna put two
additional things for you guys this is
like a bonus kind of a thing which again
you guys know but i will tell you what
it is okay
for all the new people out there it is
very crucial and very important for you
to understand the pulse of the market
okay what is the pulse of the market
pulse of the market means you should at
least know what is happening in the
stock market okay now how do you do that
okay how do i know what's happening in
the stock market very simple okay you
need to start reading news news articles
news websites you can download all the
news articles and websites economic
times live main there are so many other
websites online just start reading about
the market understand the pulse of the
market okay that is very important that
is very crucial understand the pulse of
the market okay once you understand that
you will know how the market is reacting
and that will help you make better
decisions and you will start gaining a
lot of knowledge the second thing is
start learning okay educationally start
learning what are the different type of
ratios what is roe what is roce right
how is pat growth good how is sales
growth good what is ebitda what is
ebitda margin there's so many things
right now i'm not saying learn each and
everything but learn what is important
learn what is crucial because at the end
of the day you're learning for yourself
that knowledge over here builds and if
this knowledge builds you know how to
apply that knowledge in the market and
that will eventually get you your return
so every time you start spending on
yourself to learn something don't feel
sad because it will definitely one day
pay its returns back to you got it so
don't worry about that so just to
summarize the six steps again for you
guys the first thing obviously is to
open a dmat account okay before putting
any money first understand your
investment horizon what are you
investing for and start setting a budget
aside
every month i will do this this much i
am going to invest set it for yourself
don't set it for shashank set it for
yourself okay
third thing find out the three ways to
invest right the three different type of
investments are you either do it by
yourself self-invest in stocks okay or
you put in mutual funds and don't worry
about it just put an sip and just keep
doing that or you invest in index funds
or etfs okay that is number three now if
you're doing it step number four if
you're doing it by yourself then you
should understand how to do it first
diversification is very important unders
invest in businesses that you understand
stay away from these penny stocks
volatile stocks and stuff like that okay
and invest try to invest in large cap
and mid cap don't try to go for those
quick small cap listing gains okay so do
that and step number five for new people
is how to sell and when to sell a stock
i told you only sell it if you really
need it or the investment goal has
achieved okay you've reached an
investment goal but i have to send my
parents for a vacation then withdraw it
without any care and send them off and
then make a new budget again and start
saving again from scratch okay do not
stop that you have to have a backup and
last but not the least the most
important point continue the discipline
keep investing have that discipline and
only when you have this financial
discipline trust me take any compounding
calculator out or just take any
calculator out put the worst case
interest rate that you might think i can
get okay even if you say 10 growth
you're on year put whatever amount you
want okay and multiply that until the
next 30 years of your life or even 25
years or even 20 years of your life you
see how much money will be left in that
thing corpus it's simple simple math
okay but you have to have the discipline
to do this apart from that learn as much
as possible about the market there's a
lot of videos on grow itself that teach
you a different type of the market
ratios and stuff like that also grow
keeps putting out news articles every
time it talks about what's happening in
the psu segment okay what is this new
sector ambani is getting into so start
reading all this these are quick short
videos that grow keeps putting out so
you can start reading and gain this
knowledge now in today's date knowledge
is available for free everywhere just
try to take as much as possible and
start reading some news articles as well
okay
so yeah that is what this was i hope you
liked it uh i hope you learned something
as well from this video for all the
beginners and don't stress don't worry
it is not that difficult to invest in
the stock market as you think it would
be if you think i have missed out any
step or you think shashank can you
please explain something more in detail
please leave it in the comments below i
will come and start teaching you all the
other things as well okay
and if you like the video and if you
like what i said like and subscribe
because i look at the likes and
subscribe so i get happy with that uh
but cool yeah that's it so put your
comment below if you think shoshan can
you please explain this you know we're
new investors we want to understand how
this works how that works maybe how ipo
works let me know in the comments and
i'll come and teach you that as well all
the videos that i made on the grow
channel including this one okay is only
for educational purposes we do not
recommend any buy or sell uh for a stock
in this video okay so this is only for
educational no intent to buy or sell any
stock recommendations
investments in securities market are
subject to market risks read all the
related documents carefully before
investing please read the risks closure
documents carefully before investing in
equity shares derivatives mutual fund
and or other instruments traded on the
stock exchanges