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Thursday, August 25, 2011

STAY AWAY FROM STOCK MARKETS AND SAVE YOUR WEALTH

The stock market can be considered as the most important source for companies to raise money from public. Businesses to be publicly traded, or raise additional financial capital for expansion by selling shares of ownership of the company in a public market. Companies provide their shares that can be traded in stock markets. The beginning of stock market is from 12th century France the courratiers de change were concerned with managing and regulating the debts of agricultural communities on behalf of the banks. Because these men also traded with debts, they could be called the first brokers. Now stock markets are available in developing economies, with the world's biggest market being in the United States, United Kingdom, Japan, India, China, Canada, Germany's (Frankfurt Stock Exchange), France, South Korea and the Netherlands.

What it makes you to invest in Share Market

A share owner or a share holder is having equal rights in the company same as that of the owner. The priority to take decision  goes to the number or percentage of shares of the company owned by an individual. The profit of the company is shared to the individual based upon the director board decision.

In the Annual General Body meeting, an individual who owns a stock or share of a company , even a single one, can attend and raise his opinion.

Things all go fine till here. A citizen who will take a Dematerialized account in any of the stock exchange approved brokers and start invest his money in leading stocks.

I recently read a well explained story by an individual. Please read it in her own words. This individual is now campaigning against Stock Market Trading. Investing in shares of a company is a good investment. But allowing big players to play in Exchanges is not appreciable. Let people invest for a long term, or for a specific period. All instruments like short selling, off shore selling must be totally banned. Let the real investors rule the stock market.

stock market crash

READ THE OPINION OF AN INVESTOR

I started trading at the age of 21 and until now I have gone through different up and down in markets.

My college was very near to my first stockbroker. This initiated spending some time with them(later whole time).At first when I was a beginner, I remember that there was nobody to guide me other than my Broker. The trading terminal boys ( I call them Devilzzz) usually guide(( misguide??)) to trade like this n that.

At first I lost 25000/- with in a span of 3 months. Canara Bank was my first try. I gave check of INR 25000/- in the month of March 1987 and at the end of June 1987 I got a call from my broker that I need to give another cheque to hold the items I purchase the day before.

I was shocked, where my 25000/- went?? I suspected  my broker ( believe me--I was wrong). I audited all statements and found that Shares of Canara Bank ate my money.

I found an interesting matter. I followed certain rules that went against me. The devilzzz used to bring some Technical Analysis, Intraday Trading tips etc and force us to follow that. In most days I found STOPLOSS is the Villain.

I saw that 90% of my trades booked loss in its STOPLOSS price.

So what i do now??

whom shall i beleive??
Why we need to keep STOPLOSS?

What we will do when the STOPLOSS making more loss?

A number of questions came to my mind.

From where i will get my money back?

I discussed about these situation with the stock broker again. He suggested some small training camps, discussions with elders etc. I started going through different techniques to analyse the markets.

My playground was Cash Market, until I realize what is Call option and Put option, Option trading and Derivatives.This made me greedy( I know you will say that Im not greed, just trying to get my lost money back) and I decided to leave Cash market and try my intelligence in fetching money in Futures and Options.

My Stock broker was happy and he told me to raise more capital and come back to trade.

Being a college student, how I will raise the money 60000 INR at least.

Here all readers should congratulate me:

I got money from my girlfriend ( later she became my wife)

I started trading, at first it was quite nice as some Call options immediately found some money.

But things went wrong when a severe scam hit throughout the market. I took two positions in one side.

Both land in Zero at the date of expiry..

My total Loss crept to 37000/- till

My broker and trading Devilz console me and show me the Portfolio of some other Traders who lost even more than me. ( actually they were stating that U ARE NOT THE FIRST FOOL TO INVEST IN MARKETS)

I gave a Gap of four months--and I completed my Graduation, got a small job in these period.

I came back to trading . I usually contact them over phone to know how much i earned on that day. I got a lottery in one scrip: I don't like to say the name: And i got all my lost money with some excess,

Vow...this encouraged me and I didn't take my money back from the Account. My image in Trading hub and in the Stock broker was growing better to best. They introduced me to many newcomers and I became a SUPERSTAR at there within few months.

Things were going good until I take a decision to invest more money according to advice from an INVESTMENT GURU.

I took a Bank loan of just Six Lakh and decided to invest in Stock Market.

I divide the amount and deposited in CASH MARKET, DERIVATIVES AND MUTUAL FUNDS.

I saw money growing, growing, growing and I was happy in those days.

RECESSION STORM and ECONOMIC TSUNAMI.....new villain, I didn't book my profits and I was simply keeping some STOPLOSS while trading. Vertical falls and Bounce backs literally killed my money in TRADING.

I pledge my equity in order to hold my position. All went wrong and my portfolio dried up.

I purchase some shares of low cost..all went southwards.

DONT BLAME ME:

i always hear TV channels...

i always read newspapers...

i always look how Hangseng moving...

i always look how Europe is opening...

i always look how DOW future behaves..

i always analyze how DOW &NASDAQ landed the day before..

i always put stop loss

i always study chart

i look in different websites

BUT ALL WENT WRONG

i still remember an analyst saying Reliance Industries is a Good Pick at the price of 2700.

i still remember an analyst saying ABAN is an excellent pick for long term when it was above 2000.

i still remember in a TV show, explaining the growth of ISPAT INDUSTRIES when the stock was included in F&O

WHERE AM I NOW?

while writing this, I lost my eight lakh investment and my profit of twenty lakh in total.

I know you are smiling by hearing the small amounts. But remember, I am the representative of common traders in India, who come ,sit and watch to the monitor of trading hub from 9.55 Am to 3.30 Pm. They usually leave the STOCK BROKER with a great sigh.

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