Why planning is essential before investing in stock market ?

Why planning is essential before investing in stock market ?

Why planning is essential before investing in stock market ?

Why planning is essential before investing in stock market ?

Do you plan before investing in the stock market?

Planning is always the first step whenever you are starting something new. Especially in business. Even at work, you will have a planning document that will clearly say the details of the project. Also when it has to be started and before when it has to be completed. When proper planning is done, it makes half the work done.

Generally, when it comes to the stock market, this planning takes backstage and this eventually results in stock market losses.

Why planning is essential before investing in stock market ?

In my own personal stock market journey, I didn’t plan anything.

It was like going into an unknown place with full enthusiasm. That didn’t fade away till the momentum I saw my losses.

Yes, for the next 45 odd days it was all about getting into the habit of investing. More of trading, buying and squaring off by 3 PM. Even I don’t do it, the system will automatically square it off.

All these stockbrokers will send a detailed report on the charges and profit\losses. I didn’t check for a very long time, as it was always losses or minimal profit.

After 45 days when I opened the report, it was shocking as I saw that loss was around 1 lakh. I was happy because my friend who had started along had losses worth 2 lakhs.

Lesson we learned is, “Check your daily brokerage reports”

Also, the biggest learning as I say in this blog, “Planning in stock market is essential”.

As I didn’t plan on the amount I am going to invest, I lost more. If it has been fixed before investing, I would have calculated the losses on a daily basis. This would have reduced my losses to a few thousand only instead of one lakh.

Things to plan before investing in the stock market ;

The stock market is more of a thrill and if you don’t plan well, it will carry you. Just like driving at speed, if you are not in control it will kill you.

Here in the stock market, it will make you lose money. Not just a few thousands or lakhs, even in crores. Some of the stockbrokers with whom i have interacted have shared the painful story of wealthy people becoming big losers in the stock market. They will try to make money from where they have lost.

Do you want to be a loser?

Do you want to be a winner in the stock market?

If you want to be a winner in the stock market, it is better to plan the below things in order,

Amount you are going to invest
Are you a trader or an investor ?
Checking daily reports after trading or investing
Checking daily news on trends which will drive the market
Reading stock market magazines
Reading books on the stock market
Stop-loss in your total amount

All these points will help you to minimize losses if investing or trading goes wrong.

Most of the first time investors will never have stop losses in their trades or even in their planning stage. This will make you understand that there is a possibility of losses in the stock market and be ready for it.

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