Thing To Consider Before Investing In Stock Market

Hello friends, welcome to Stock Market Knowledge. Today I will tell you about an important topic. If you want to buy any share in the stock market, what are the seven things you should keep in mind? This thing stays away from the identity of small investments. In fact, even those who have been in the market for a long time, probably do not know this thing. Friends, by keeping these 7 parameters in mind, you can earn a lot of money from the market.

The thing written in this article is only for educational purpose.

1. Chart Pattern

Friends, there are two types of chart patterns. One long term and one short term. Before buying any stock we should see the long term chart pattern of the stock. If the chart pattern of the stock is increasing from left to right then we should pick such stock. If the chart pattern of the stock is decreasing from left to right then we should not buy such stock at all.

The long term chart will give you prima facie evidence whether this stock is good for long term or not.

2. Promoter Holding

Promoter holding is seen percentage wise which should be at least 50%. But it is not necessary that this rule is mandatory. There are also such shares in the stock market whose promoters are zero percent, yet those shares are performing very well today. But promoter holding of more than 50 percent provides a sense of safety.

3. Pledging of Shares

As we have seen that the promoters have more than 50% shares, but we should also know whether those shares have been pledged by the promoters. If promoters take loans by pledging the shares, then it becomes one of the biggest threats to the investment. Even if a promoter pledges his shares, it should not exceed 25 percent of his shares.

Suppose if the promoters took a loan from the bank by pledging their shares and they fail to repay the loan, then the bank will recover their money by selling their shares in the market and you may suffer losses.

4. Debt on the Company

If the debt of the company is more than the reserves of the company, then we should not give such a company a place in our portfolio for some time.

If the company is taking loan regularly and the profit of the company is also decreasing regularly then we should be careful.

5. FII DII and Insurance Company Holdings (FII, DII and Insurance Companies)

We have to check the holdings of all the big investments in our shares because a lot of money is invested in shares of big investments, so their shareholding pattern becomes necessary for us.

6. Company Information

• Whenever we want to buy a share, we should first go to the website of the company and check this thing by going to the website.
• What does the company do?
• company's management board
• Where does the company operate?

7. Company Management

We should also know about the people who run the company. People come in this...

• Chairman
• Managing Director (MD)
• Chief Executive Officer (CEO)
• Directors
• Officers

Friends, 99 percent of people do not know these things, so before investing in any of your shares, keep 7 things in mind.

What to look for before buying shares?

1. Chart Pattern
2. Promoter Holding
3. Pledge of shares
4. Debt to the company
5. FII DII and Insurance Company Holdings
6. Company Management
7. Company Information