Trading in simple terms is an exchange of goods and services among different individuals. However, when it comes to the stock market, trading is referred to the exchange of stocks of different companies that are listed on the Stock Exchange among various traders and investors. Traders can have the opportunity to gain exceptional profits without investing huge money that otherwise is required as a capital investment in the business. On the contrary, businesses listed on the stock exchange have the option to raise capital by selling their stocks in the market. The stocks are purchased at a value that suggests the goodwill and growth of the company. Market fluctuations including increased demand and supply or vice versa can cause variation in the value of each company’s stock. Now, anyone who is willing to become a stock trader needs to know the basics of the Indian stock market. This article will help you understand the basic aspects of becoming a stock trader. Let’s get started,
What is a Stock Market Trader?
A stock trader in the scenario of the Indian stock exchange is an individual equipped with the information and knowledge required for pursuing trade with experience in the Indian stock market. The stock market trader can trade in the share market as,
- A professional stock trader in the broking firm.
- A professional stockbroker working in the financial institutes dealing with hedge funds or mutual funds.
- An independent stock trader directly registered with the stock exchange.
What do you Need to Become a Stock Trader?
A professional stock trader who is willing to work in a reputed financial institution or a broking firm is required to gain Capital Markets Dealers certificate from National Stock Exchange. Any similar certificate from BSE or any other institute would also work. More than anything else, the thing that works is proficient training that enhances your experience. A stock trader who gains experience can build a professional career in the market.
The key to becoming a wise trader is by exploring practical applications of theories in the real market. Whether you are willing to proceed with trading in a professional financial institution or become an independent trader, it’s crucial to gain all the aforementioned certificates along with work experience. To become a successful trader, you will have to go through a long process. You need to be dedicated and well-off so that you can cover the initial investment.
The key to becoming a wise trader is by exploring practical applications of theories in the real market. Whether you are willing to proceed with trading in a professional financial institution or become an independent trader, it’s crucial to gain all the aforementioned certificates along with work experience. To become a successful trader, you will have to go through a long process. You need to be dedicated and well-off so that you can cover the initial investment.
Important Skills to Focus On as a Day Trader
Take a look at some of the critical skills you must have to pursue trade in the Indian stock market. These include:
- Patience: This skill is important to adhere to discipline in your trading activity. However, the amount of patience should be balanced as keeping the share for too long or too short is both risky.
- Dynamic Approach: No trading situation or events are alike. They have constant variations and hence traders should have a dynamic approach.
- Determination: You certainly need to be determined about your respective interest. There is a lot of information and finding the right data to base decisions is critical.
All in all, becoming a trader is not rocket science but it’s also not child’s play. You need determination, knowledge and correct aptitude to apply the knowledge in the right direction. Stock trading is extremely profitable, hence choose the right strategy to gain accurate results.