Stock Market a Wager or Calculative Risk - Advisorymandi

Stock Market is a fascinating world of profit & loss, ups and down. It is a place which can turn your dream into reality. But every individual doesn’t have that audacity to take the stock market excitement and so people stay away from the market.

Many Individuals feels stock market is a sheer gamble, Indians are only satisfied with the guarantee. But whether your investment is a gamble or a calculative risk, it completely depends on you. Our way of taking decision ultimately decides whether it’s a gamble or smart investment to put your money to work.

Stock market is just synonym to life, full of uncertainties’, you never know what will be the next smart move of the market, which will make the life of millions and at the same time break some dreams too. As it’s a zero sum gain, for someone to gain, one has to lose.

To understand, whether stock market is actually a gambling or not, we must understand, why are we buying a stock and what does that stock represent. This is the first step where investing in stock market will be differentiated in the form of gambling or investing. If we don’t know the answer to the stated two questions, we are definitely going towards gambling, not into smart investing. We must understand taking any decision without knowing the backdrop of the decision is anyway a gamble in all aspect.

An investor must understand that buying a stock is actually buying a part of the company and we must be aware why and how a company work. So now comes the question do you wish to be a long time investor or a trader? This could only be answered, once you know your financial goals. So if you are an investor then you must be investing in a stock of a business which you understand well and know what all factors will affect the value of the business. But without doing any homework if you put your money in any stock blindly following the masses, in such case you are actually gambling and you will end up losing money.

Now you say, ok I am not an investor, I better be the trader, I am ok with small but frequent gains, so we bet on price fluctuations happening on daily basis. Now as a trader you have two ways to put your bet, either put your money without any analysis, into a stock which is rising and wait for the stock prices to rise further and take you share of gain from the same. However, without any analysis, if you put your money, it might happen your entry point is wrong, and stocks start to fall immediately after you buy the stock. So such uninformed decision turns the investment into waste and that is what is called gambling.

Whereas now, instead of blindly following the herd, if we had done some technical analysis to test, which is the right time to enter the stock and exit the stock, we could have minimized the risk factor thus increasing the chances of profit. And this will be an informed decision which will aid in getting to the right track and make money from money and not losing it.

To change our gamble to an informed decision, we must have a thorough knowledge of the market and its working. However, in this busy life, we do investment but rely on other individuals like portfolio managers to take care of our investment. However, for a small in investor, it is difficult to look for a portfolio manager as their cost are really high and also they look for a minimum threshold of investment.

So we can get advice from Stock Advisor that too from SEBI registered analyst at a very minimal cost in various segments of the market, be it Commodity, Currency or equity.