Knowledge Base / Investor Education

Do's & Dont's of Investing

Learn To Trade the Right Way

Before you begin to venture into the world of capital markets, a basic understanding of the industry is a must.

Firstly, one needs to understand, that as seen in the movies, there is no such thing as overnight richness. To be able to stay afloat in the market, the first and foremost rule is to diversify your risk. It would be best to divide the money you are willing to invest into a number of stocks rather than gambling all in one.

Secondly, to be able to trade a basic knowledge of the market is necessary and that requires a lot of reading and assessment. Before you choose a company to buy stocks from, it’s advisable to read the company’s Annual Report to gain an understanding of their business plans and strategies which can have a long term impact the price of the stock. Once you have done your basic research its best to start with a small amount of money and learn the tricks of the trade - remember, ‘Slow and Steady Wins the Race’.

  1. As a first time trader, find yourself a broker than can offer step by step guidance about the stock market
  2. Asking your friends and family of a broker is advisable as they can provide vital insight from their own experience
  3. Ensure that you have a licensed broker – Find the list of Brokerage houses from the NCCPL web page
  4. Risk diversification is key, hence shortlist 12 companies that you would like to invest in and start trading
  5. Blue chip companies remain stable in the market, whose stock prices face minimal fluctuation
  6. Subscribe to National Custodial Services (NCS) by submitting a NCS Account Opening Form for admission; UIN Information System (“UIS”) Account Opening Form to perform activities and to view on-line reports pertaining to NCS; Central Depository System (CDS) Account Opening Form to open and maintain CDS sub-account with NCCPL
  7. Trading Right Entitlement Certificate (TREC) Holder will open a trading account for NCS Client for trading in the stock market a TREC Holder can place orders in the market as per the instruction of NCS Client and these trades will be settled directly by NCCPL
  8. Once all your paper work is complete, you are ready to start trading

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