Published - Fri, 18 Feb 2022

Know The Difference Between Investing And Trading In Stock Market!

Know The Difference Between Investing And Trading In Stock Market!

Stock trading is the practice of purchasing and selling stocks for a short-term profit, with an emphasis on share prices. Investing entails purchasing stocks in order to profit in the long run.

Trading and investing require you to pursue profit in the stock market, although you can do it in so many various ways.

There are many traders who either enter or exit their equities in order to make or further maximize their profits. So, it is evident that they concentrate more on the stock and its characteristics than the company they are investing in and its long-term potential!

As traders always look for the direction in which the stock would go or grow next and how would they profit or gain from that particular move.


Trading the Stock Market – Why Most Traders Fail | Wealth Within


Whereas the investors always think for the future. They are quite visionary. Having a long-term perspective regards to stock market can be quite challenging but investors do it all. They always think in years and how their equities would behave with markets ups and downs.

When it comes to creating money in the equities market, the two genres of the sector are investment and trading. Investing and trading are two different ways of amassing wealth and profits for yourself techniques to create wealth or profit in the financial market.

Let's look at 5 important differences between investing and trading to understand the same in financial markets.

Know These 5 Differences Between Investing and Trading?

Time Period

Trading is a way of keeping stocks for a limited time. It may be for a week or even every day! Traders retain equities until they achieve short-term high performance, whereas investing is a buy-and-hold strategy. Investors put their money to work for years, decades, or even centuries. Short-term market changes are irrelevant in a long-term investing strategy.

Capital Gains

Traders monitor the market's stock price fluctuation. If the price rises, traders may sell their holdings. That is trading is the ability to understand the timing in the market while investing is the art of amassing wealth over time by compounding interest and dividends. This could happen by carrying out an excellent analysis of the financial market.

Risks Involved

Without a question, both trading and investing include capital risk. Trading, on the other hand, involves a much larger risk but also comes with a big potential reward in form of capital gains. It should be remembered that investing is a form of art, and like any art, it demands time to be mastered.

It has reduced risk and lower returns in the near run, but if kept over a longer length of time, it may produce better returns through compounding interest and dividends.


Reducing Stock Market Risks - Technical Analysis Articles

Skill vs. Art

Let's put it this way: trading is like a one-day cricket match, but investing is like a test match. In a one-day competition, you would watch skilled players in the team who are expected to hit fours and sixes to increase their score.

The art of the game, on the other hand, maybe viewed in the test match! Similarly, traders are experienced, technical individuals who pace the market and understand market patterns in order to maximize earnings in a short period of time. This deals with the psychology of the market.

Investors are more likely to conduct in-depth research about the equities in which they wish to invest. Investing also entails knowing business basics and making a long-term commitment to stay committed. It is always attributed to how the company thinks and what its ideology is.

Action takers

Traders invest money in a stock for a limited period of time. They purchase and sell quickly in order to capitalize on the market's increased gains. Missing the correct timing might result in a loss. They examine the current performance of the firms in order to reach higher prices and book gains in the near term. Investors avoid trends in favour of investing on value. They invest over a longer length of time while maintaining a close watch on the stocks they own.

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How To Close Your Demat Account Online?
How To Close Your Demat Account Online?
When we finally decide to invest and trade, we often lookout for ways to execute the necessary process. One such is creating a Demat account. But with today’s fast-paced worldly affairs, we tend to forget and become lazy and keep postponing things till the last hour. And this might turn out to be an expensive error, especially in the world of the stock market!Fees and maintenance costs apply to Demat accounts. As a result, it is advised to cancel any of your inactive or zero balance Demat accounts immediately. Otherwise, we will lose money. As a result, knowing how to terminate a Demat account is critical.Demat or dematerialized accounts are an excellent option for most people to supplement their income. An online account is required for investors who trade in the financial markets.According to SEBI, the country has around 44.46 million Demat accounts. Basically, a Demat account is an electronic account where your shares and securities are stored. With the economy improving, more individuals are hoping to jump on the stock exchange bandwagon.Regardless matter how large the statistics are, SEBI has revealed that over 75% of accounts remain dormant. An idle Demat account is a financial drain that incurs yearly fees and maintenance expenses. As a result, it's a good idea to prevent any excessive expenses and terminate your Demat account.Know These Before Closing Your Demat AccountNote that, your Demat account cannot be simply canceled by submitting an online request for its closure. Be it through email or customer care.You are ought to submit an application in person that includes the hard copies of all the mandatory papers. But there is also a way out. If you are facing a time crunch, then pace up the entire process by downloading the closure form online.Follow these basic steps to know how to close Demat account online:·       Make sure that there are no shares in your account.·       Also check whether the account has a negative balance. ·       Check your account details by checking in to your account or by contacting your registered branch. Make a note of those details.·       Get your Account Closure form, fill in those required details, and submit it in person.Two Types of Demat Account Closure!Account closure: If there are no payments pending or being on hold in your account [you being the investor], then your request to close the Demat account online would be sent.It would be sent off to the relevant depository partner [also referred to as DP].Transfer and account closure: This method is a bit different. Suppose, you still have some securities pending and need to be transferred to another Demat account, then go for this method before actually shutting off your original Demat account. Close Your Demat Account OnlineFill up all the details in the Account Closure Form. If the Demat account is shared by more than one person, it is mandatory for all holders to sign it in the presence of a Depository Participant (DP) official. A brokerage business or a bank can serve as the DP.Make sure when completing the closure form, you do not forget to include the following information:·       Your ID and the DP ID KYC data, such as name and address, are in sync with your records.·       You also need to explain the reason why you want to close your Demat Account online.·       Finally, don’t forget to attach a self-attested identification proof copy which is verified by a bank employee.When moving pending holdings or shares from one Demat account to another, the following steps must be taken to cancel or delete a Demat account:·       There are two major national depositories in India, namely, NSDL and CDSL. If you are doing intra-depository transfers then an Intra DIS slip will be required, along with the 'Off-Market transfer option.·       Next, get an original Client Master List [CML] with proper logo, stamp, and signatures.·       After this, fill in the form with all the required data with the names of the shares that have to be transferred.·       Do not ever forget to mention their respective ISINs.·       The target client's ID, a 16-character code, should be specified too.·       Finally, submit your paperwork at the DP's office or simply mail it to their headquarters.·       For closure, a bank official must additionally check the self-attested Demat closure form. Final Thoughts Though Demat accounts cannot be entirely closed online, their process can be simplified by completing all the essential paperwork online. It is critical to ensure that there are no outstanding charges, fines, or shares in the account and that all of the information is correct. To avoid errors or lapses, the individual's details must be reviewed before transferring any shares or accounts.

Mon, 21 Feb 2022

What Is Demat Account? Meaning, Benefits & More!
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Mon, 21 Feb 2022

Know The Difference Between Investing And Trading In Stock Market!
Know The Difference Between Investing And Trading In Stock Market!
Stock trading is the practice of purchasing and selling stocks for a short-term profit, with an emphasis on share prices. Investing entails purchasing stocks in order to profit in the long run.Trading and investing require you to pursue profit in the stock market, although you can do it in so many various ways.There are many traders who either enter or exit their equities in order to make or further maximize their profits. So, it is evident that they concentrate more on the stock and its characteristics than the company they are investing in and its long-term potential!As traders always look for the direction in which the stock would go or grow next and how would they profit or gain from that particular move.Whereas the investors always think for the future. They are quite visionary. Having a long-term perspective regards to stock market can be quite challenging but investors do it all. They always think in years and how their equities would behave with markets ups and downs.When it comes to creating money in the equities market, the two genres of the sector are investment and trading. Investing and trading are two different ways of amassing wealth and profits for yourself techniques to create wealth or profit in the financial market.Let's look at 5 important differences between investing and trading to understand the same in financial markets.Know These 5 Differences Between Investing and Trading?Time PeriodTrading is a way of keeping stocks for a limited time. It may be for a week or even every day! Traders retain equities until they achieve short-term high performance, whereas investing is a buy-and-hold strategy. Investors put their money to work for years, decades, or even centuries. Short-term market changes are irrelevant in a long-term investing strategy.Capital GainsTraders monitor the market's stock price fluctuation. If the price rises, traders may sell their holdings. That is trading is the ability to understand the timing in the market while investing is the art of amassing wealth over time by compounding interest and dividends. This could happen by carrying out an excellent analysis of the financial market.Risks InvolvedWithout a question, both trading and investing include capital risk. Trading, on the other hand, involves a much larger risk but also comes with a big potential reward in form of capital gains. It should be remembered that investing is a form of art, and like any art, it demands time to be mastered. It has reduced risk and lower returns in the near run, but if kept over a longer length of time, it may produce better returns through compounding interest and dividends.Skill vs. ArtLet's put it this way: trading is like a one-day cricket match, but investing is like a test match. In a one-day competition, you would watch skilled players in the team who are expected to hit fours and sixes to increase their score. The art of the game, on the other hand, maybe viewed in the test match! Similarly, traders are experienced, technical individuals who pace the market and understand market patterns in order to maximize earnings in a short period of time. This deals with the psychology of the market.Investors are more likely to conduct in-depth research about the equities in which they wish to invest. Investing also entails knowing business basics and making a long-term commitment to stay committed. It is always attributed to how the company thinks and what its ideology is.Action takers Traders invest money in a stock for a limited period of time. They purchase and sell quickly in order to capitalize on the market's increased gains. Missing the correct timing might result in a loss. They examine the current performance of the firms in order to reach higher prices and book gains in the near term. Investors avoid trends in favour of investing on value. They invest over a longer length of time while maintaining a close watch on the stocks they own.

Fri, 18 Feb 2022

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