Is the stock market risky business to invest! It is a question asked by 80 to 90% people. Today I will tell you investing in the stock market is dangerous or it’s a myth.
Is the stock market risky business to invest
Is it good to invest in the share market? Is the stock market high risk or low risk? All these questions come to mind when we are not aware about a particular segment.
There are different selling options in the stock market including intra day and holding. Stock market is known for trading and trading meaning in stock market is selling or buying the shares of any company.
There is less risk while selling and buying shares in long term. Simple investment plan (SIP) is a good choice to reduce risk. Risk comes in the particular segment like intraday. When a person sells or buys shares in intraday trading it becomes compulsory for them to sell/buy the share on the same day whether prices are favouring or not. Let’s understand the intraday stock market.
Intraday share market risky and dangerous
Intraday in the share market is the most risky market. When people say the share market is risky then they are not aware about other trading types they only know about intraday. If you ask me if the share market is risky then I would say yes it is a high risk market if you are doing only intraday.
The biggest limitation of the intraday market is people have to sell/buy the picked shares the same day before 3 pm. Intraday gives 10 time limits to their customers. For example if you have invested Rs 100 then you can buy the shares of Rs 100 x 10 = Rs 1000. If share price goes down and you lose all the money then you will lose your actual invested Rs 100 only you don’t have to pay the 10 time limit money which is Rs 1000.
This is the biggest greed in which people often get trapped. If they do not win the first time they again pay next time because they are getting a 10 time limit and don’t have to pay the limit amount. By doing this continuously slowly they invest a big amount and keep thinking that this time the share price will increase and win big money. For these kinds of people the stock market is very risky.
Holding stock market safest in the world
Looking from another view, the stock market is the safest market to invest in the world. Let’s understand how. Why I am saying this is because people have the option to sell the shares immediately and hold them as long as they can. After investing in the stock market (holding), they can hold the shares for one month, six months, 1 year to 6 years, 10 years or more.
For example if you have invested Rs 10,000 and purchased 50 daddyblogs company shares at Rs 50 and the price increases up to Rs 55 on the same day you can sell and book the profit on the same day even after 3 pm or late evening. If the share price goes down at Rs 40 you can hold all the shares and wait till the share price increases again over Rs 50, when it goes over Rs 50 you can book the profit.
No limits are given in the holding segment. If a person invests Rs 10,000 then he/she can buy the shares of Rs 10,000 only.
It is advised to invest only that money in the stock market which you are wasting in burgers and other fast food.
FAQ
Is the stock market high risk or low risk?
Stock market trading is done in two types: intraday and holding, risk depends on their format.
Intraday – Same day sell – High risk.
Holding – Sell immediately or hold for a long time – Low risk.
Why is the stock market high risk high reward investment?
If the share prices increase unexpectedly there is a high chance to earn huge money and if the price goes down huge loss may happen.
What is the stock market?
Market where people used to trade in shares by selling and purchasing them.