Online trading in India

Online trading in India

Investments in stocks and mutual funds have taken the country by storm in the past decade or so. Everyone has been hit with this bug. People in India originally preferred to invest their money in safe mode of investments and they saw investments in stocks as a very risqu‚ proposition.

The economy over the past couple of years have growing at a solid 8-9% annually and with the opening of investment opportunities in industries like telecom , retail , banking, automobile etc for the FIIs and FDIs , huge amount of cash has in flowed into the economy.

With the breaking of Ketan Parekh and Harshad Mehta scam in early to late '90s, people were very skeptical about the working of the stock market. but with SEBI ( Securities Exchange Board of India) tightening their grip on the working of the markets to the world standards, people have realized that making money by investing in stocks requires lot of skills rather than scams.

Sensex and NSE are going through a bearish phase for past 6 months because of the high crude oil prices and the soaring inflation rate which has touched a peak of 11.89% recently. Adding to this the unstable political alliance of the Congress and the Left has helped in boosting the bearish run. On 22nd July 2008 market showed a correction of 800 points but experts feel that market is still in a bearish phase.

In order to invest money in stocks online you need to

(a) Have a computer with an internet connect
(b) Create a demat account with a bank
There are many online brokers like sharekhan.com, indiabulls, icici, hdfc etc you need to first register with one of these brokers and then start investing your money in stocks. In order to open a demat account in India you must also have a PAN Card no.

People have made huge amounts of money by investing in stocks but there are people who have lost more than they earned. In short it's not a cakewalk. It's not something which you can do like net surfing. In order to make money from online trading you must understand the movements of stocks. Every stock market is greatly linked to one another, so a bearish movement in one major market can have a trigger effect in many other markets. Even if our economy is growing at 10% and inflation is at check, rising crude oil prices may have a dampening effect on the booming stock market.

South Asian countries are facing high inflation rate which has crowded out investment potentials in the economy. So people must realize what the right time to buy and sell is.

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