How to Earn Money in Share Market Daily (2024)

The share market is an exchange through which investors buy and sell shares in publicly traded companies. When an investor buys a share in a company, they essentially own a portion of the company. As the value of the company increases, so does the value of the investor’s shares.

To begin, let’s break down the basics of the share market.

• Stocks: Stocks represent shares of ownership in a company. When you buy stocks of a company, you can make money through its appreciation in value, dividends, or a combination of the two.
• Bonds: Bonds are like loans that you make to a company. The company has to pay a certain amount of interest rate regularly and the face value of the loan is returned when the bond matures.
• Mutual funds: Mutual Funds are baskets of different stocks and bonds that are managed by a professional fund manager.
• Derivatives: Derivatives are financial instruments whose value is derived from an underlying asset. Examples of derivatives include futures, options, and swaps.

How to Research and Analyse Different Stocks to earn money in Share market daily?

There are basically two ways to analyse stocks. Both approaches are used to predict future price movements and analyse the behaviour of the stock market.

1. Fundamental Analysis:

It involves looking at much more than the middle line of the financial statement. Analysts consider the broader context like the economy, industry, and company-specific metrics. They review financials such as earnings, expenditures, assets and liabilities. It helps them gauge a stock’s intrinsic worth.

2. Technical Analysis:

It tries to discern potential opportunities based on statistical trends. It includes changes in a stock’s cost and volume. Technical analysts look at stock charts to identify patterns and trends that predict the future movement of a stock.

Different Investment Strategies for the Share Market

Investment Strategies are techniques used to make money in the stock market. Strategies signal you to buy/sell a security. So, if you’re wondering how to invest in the share market, applying a good investment strategy will be our answer.

Here are some popular investment strategies:

1. Buy-and-Hold Strategy.

This involves purchasing a set of shares and keeping them for the long term. This type of strategy involves risk, but if you choose carefully, the rewards can far outweigh the risks.

2. Active Investing.

This involves regularly keeping tabs on the market, and buying and selling stocks as the market trends up and down. This type of strategy also involves risk, however, because you will need to be able to predict when to buy and when to sell.

3. Invest in Mutual Funds.

These bundles of shares, bonds, and cash are managed by professionally-trained investors. The benefit of investing in a mutual fund is that you’re effectively sharing the risk with other investors.

Intraday Trading in the Share Market

Intraday trading is a type of investing in which you buy and sell shares or securities within the same day. The goal here is to capture the price differences of various assets to make a profit – but you need to do it quickly!

• Overview: In Day trading, you don’t buy and hold to make money over the long term. It’s a more active approach, as it involves quickly analysing stocks, trends and news for short-term opportunities.
• Advantage: The upside of day trading is that you can literally make money every day. Given that you’re disciplined and have a good strategy in place. As well, the more you practice, the more success you will have in this field. So, how do you get started?
• Pre-requisites: First, you will want to select a day trading brokerage, such as Zerodha or Upstox. Then, decide on a strategy.

How to Earn Money in Share Market Daily by Trading

1. Get Educated: The most important factor for success in day trading is knowledge. Before you can dive in, you need to learn the basics of trading. Make sure you’re knowledgeable in your chosen field and up-to-date on any rules and regulations that apply.
2. Create a Plan: Create a trading plan that outlines objectives, strategies, the risk-reward ratio, the timeframe, and any other factors that are important to your success.
3. Set a Schedule: You don’t have to be in front of the computer all day long to be successful, but you do need to dedicate a significant amount of time to studying the markets and preparing for trades.
4. Use the Right Tools: Day trading without the help of a few tools is like driving blind. You’ll need a reliable stock screening tool, a good trading platform, and access to real-time data.
5. Find a Mentor: Having someone knowledgeable and experienced to discuss strategy and provide assistance is invaluable. Enlist the help of a mentor or trading coach to help you navigate the markets and provide guidance along the way.

Day Trading Strategies

Different strategies can help improve your chances of success, but it’s up to you to decide which one is best for your temperament and financial goals.

Let’s explore a few popular day trading strategies and the pros and cons associated with each

1. Scalping

Scalping is a strategy that involves buying and selling assets in tiny increments (typically in less than 5 minutes) to make small profits in the short term.

2. Range Trading:

Range trading is when you hold a position within a specified range until it reaches its goal price.

3. Momentum Trading:

Momentum trading is a strategy that focuses on buying assets that are increasing in price and then selling them as soon as they reach their target price.

4. Swing Trading:

Swing trading is a strategy that focuses on buying stocks after they have dropped in price and then selling them as soon as they have reached their ideal price.

Short-Term Investments in Share Market

Pros and Cons of Investing in Short-Term Stocks:

Short-Term Investment Opportunities

1. Scalping:

• It is a trading strategy that involves buying and selling stocks in quick succession to take advantage of small price fluctuations.
• It’s a time-sensitive strategy that is used to capitalise on short-term profits.
• However, it’s risky and requires a lot of knowledge of the stock market to be successful.

2. Swing Trading:

• It is an investing strategy that aims to capitalise on short-term price movements in individual stocks.
• It involves buying and selling a stock within a few days or weeks. It takes advantage of the stock’s price swings and aims to make quick profits.
• Swing trading requires carefully monitoring the markets and identifying emerging patterns and trends. If done correctly, it can be an effective and lucrative way to invest.

Which One to Choose?

Trading on News

Types of Financial News

Financial news typically falls into two major categories:

• Scheduled events such as elections, company earnings reports, and economic data releases.
• Spontaneous news can catch traders off guard. For example, the 2008 financial crisis and the 2020 pandemic.

News Trading Strategies

1. Stock Market News Trading

You first have to be familiar with the relevant terms. News like management decisions, share buybacks and company earnings reports are the key players in this game. You can monitor these events through official company websites.

2. Interest Rates Trading

Interest rate is the rate at which you can borrow money from a financial institution and the cost of borrowing money. The higher the rate, the more expensive it is to borrow.

Here is the expected immediate impact on various assets when interest rates are hiked (the reverse is true when they are cut):

3. Employment Data Trading

Employment data indicate whether a specific sector is doing well or not by measuring job growth or other economic data. When that latest jobs report is negative, it could prompt the central banks to keep interest rates lower than expected.

Here’s what might happen with various assets if employment data is negative. (the opposite is true when they are positive).

Risk Management

Risk management refers to the practice of analysing and managing the potential risks associated with trading. It involves avoiding or mitigating the possible losses associated with trading. It’s an essential skill for any trader who wants to make wise decisions.

Here are some of the most efficient risk management strategies:

1. Diversification

• Diversification is a great way to spread out your investments and reduce risk.
• It involves investing in an array of different stocks and industries so that if one sector falters, your overall portfolio won’t suffer too much.
• It’s all about managing risk and maximising potential gains.

2. Stop-loss Orders

• f2Stop-loss orders are a great tool for minimising risk when trading or investing.
• It’s an order you place with your broker to buy or sell a security when its price reaches a certain level.
• Stop-loss orders are especially helpful if you have a larger portfolio.

3. Position Sizing

• Position sizing in the stock market refers to how much of your portfolio you allocate towards a certain stock.
• It’s important to size your positions in a strategic way to spread risk and maximise potential profits.
• By being mindful of your position size, you can reap the rewards of the stock market without taking too much risk.

4. Controlling Emotions While Trading

Here’s our advice for staying disciplined and avoiding emotional trading decisions:

• Set clear rules and stick to them.
• Do your research, develop a trading plan and follow it – no matter how tempted you are to break the plan.
• Don’t make decisions based on gut feelings or emotions. Trade is based on factual data, research, and analysis.
• Take a break if you feel like you’re getting too emotionally invested in a trade.

Finally, challenge yourself to stay disciplined and stay focused on the bigger picture. With practice, you’ll develop good trading habits that will help you make good decisions.

Wrapping Up

In conclusion, investing in the share market can earn you great returns with proper planning and knowledge.

The most important things to remember on how to earn daily in the share market are:

• Identify your goals and risk tolerance.
• Through research and understanding of the market.
• Diversification of your portfolio.
• Control of emotions.

Want to explore helpful techniques to save and grow your hard earned money? Dive in to our guide onSave Money.

Frequently Asked Questions (FAQ’s)

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