Investment in Stock Market or Equity Market is a fascinating subject. As we mentioned in ‘Simple Right Actions’ you need to invest in the education of the market on a continuous basis. So you will not only keep equipping yourself with Risk Management techniques but will also remain a student for your life. Learn to enjoy this and you will young!! This education is really worth your time and money.
One can invest in the Stock Market based on Fundamental Analysis or Technical Analysis. Fundamental analysis is studying the intrinsic value of the share. Technical Analysis is studying the moment in the prices along with many parameters. People have succeeded in both. There are also people who have lost money owing to poor Risk Management. So till you become familiar with the market, it is better to have a mentor who is well experienced.
Of course, attitude plays a crucial role in one’s success or otherwise. This means that you will take 100 % responsibility for the results. One important aspect in Stock Market is consistency and discipline. Some of you may like Fundamental Analysis and some may prefer Technical Analysis. Whatever may be your approach, there is no substitute for your experience. This is precisely the reason for having the guidance of an unbiased mentor.
Taking our own example, we allocate more time for Technical Analysis. We have our own preferences in formations, moving averages and indicators, but we keep all these simple for ourselves. Examples of Technical Analysis using our ‘simple and happy’ approach:
- Tata Steel as on August 20, 2010: Average Directional Index is below 20 and when it starts to rise above 20, the share will offer opportunities in Options Trading. Keep watching.
- Hindalco is showing a Doji Pattern on August 19, 2010 and trend may reverse.
The more you allocate time for the market, the more you will feel the need for being a life-long student. For knowing our ideas on a continuous basis, please keep reading our blog.