The stock market can be a confusing place, especially for a beginner that has no idea where or how, to begin with.
And let’s say you figure that out somehow, the question most people ask themselves is – how much should I invest to start with?
You hear hundreds of success (and failure) stories about stock markets, which are enough for you to make a calculated move and start investing with the least amount of money possible.
And for that reason, ₹100 can definitely help you make an entry in the market.
Let’s talk about it!
Investing in a stock market with ₹100
A stock market is a financial market where publicly traded company shares are purchased and sold.
Now, these company shares could range from anywhere between a single rupee to thousands of rupees. But the most important thing is that you can still start with a mere sum of ₹100.
Investing in the stock market entails buying shares in one or multiple companies listed in the stock market through any means. This means that with ₹100, you can either buy a complete share of a company (depending on its price), or buy the entire stock.
The consensus is to buy stocks and sell them at a higher price to pocket the price difference as profit. Sure, the profit or loss in the market with ₹100 may not be significant, but it still counts.
What is the minimum amount of money to start trading?
You can start investing with as little as ₹1 as long as you find a stock within this price range. For instance, many stocks cost less than ₹1 and you can buy them and start trading right away.
It’s important to note that the amount you need to start trading in the stock market is not necessarily the same as the amount you need to invest in a particular stock – this is because some brokers could require you to keep a minimum amount as a balance in your trading account. This can vary between ₹0 and ₹500 in most cases.
Can you invest ₹100 in the share market?
Under normal circumstances, investing less than ₹100 in stock markets is possible.
Even MoneyIsle allows you to do that!
For this, you will need to find a stock that costs less than Rs.100 and buy it.
But it is also important to understand that the higher the money you invest, the higher the chance you will earn from the returns the stock gives.
Hence, it is always a good idea to scale up your investment amount as you get comfortable with investing.
Having said that, starting with just ₹100 is completely possible, and it is a good way to get the hang of stock market investing and trading, especially if you are a beginner.
How to invest in the stock market with Rs.100?
Prerequisites – Trading requires a trading account and a Demat account. A Demat account allows you to keep the purchased shares in electronic form, whereas a trading account facilitates buying and selling. You can create an account with a SEBI-registered Stockbroker by submitting documents like a PAN, AADHAR, photos, canceled cheques, etc.
Where to invest – According to your preferences, you can invest in primary or secondary markets.
Secondary Market – The secondary share market is where transactions involving the buying and selling of stocks between traders/ investors occur. You can choose the stocks that you want to buy or sell. In addition, you can decide the price at which you would like to buy or sell a specific share.
Research – Before investing in a particular stock, it is essential to research the company, its management, financial health, and growth potential. This information can assist you in deciding whether or not to invest in a particular company.
Before investing in a company’s stock, there are multiple ways to research it. First, the company’s financial statements, such as its income, balance, and cash flow, can be reviewed.
All this information is publicly available.
These documents contain vital information regarding the company’s income, expenses, assets, liabilities, and cash flow.
The company’s annual report includes a summary of its business activities, financial performance, and strategy.
In addition to studying the company’s financial statements, it is prudent to read news items and analyst reports. This might aid in your comprehension of the company’s industry, competition, and growth possibilities. Additionally, you may wish to consult with a financial counselor or expert who can provide assistance and insight into the stock market and specific investing opportunities.
You can get your trading career started with as little as ₹100. However, it is essential to keep in mind that trading with a small account can be difficult and may not be ideal for everyone.
As a beginner though, it’s fine!
It can be tough to produce big gains while trading with a smaller amount, which is one of the primary obstacles associated with this type of trading.
If you have a low balance in your account, it’s possible that you won’t be able to afford to trade larger positions, which will restrict the amount of money you can potentially make. In addition to this, you may be more susceptible to the impact of trading charges, such as commissions and spreads, both of which can reduce the amount of money you make trading.
As you plan to start investing, what better way to start investing than right here at MoneyIsle – the simplest online trading platform!