I want to know about the share market how it functions?

can anybody guide me how i can learn about trading of shares how i can benifit myself from small investments and how the market goes up and down what are the factors behind it how i can get the study material on net so that i can train myself and get litreted about it what all to be watched to be on safer side although i know their cant be any particular set of rules but in any conditions up and down depends on many factors so how to learn and invest in shares intelligently thru net like i have hdfc trading account thru which i can trade so please guide me what to do friend help is needed

Buy a diversified series of HIGH QUALITY, LOW EXPENSE mutual funds. One good piece of advice is that especially when just starting out, owning individual stocks is just way too risky. In many cases, it's more akin to gambling than investing. So go with mutual funds, which are much more diversified, and therefore spread the risk among many, many more holdings. The key, of course, is buying quality. So make sure you hit ALL the asset classes, like Large cap stocks, small/mid cap stocks, international stocks, emerging markets stocks, government debt, corporate debt, hi-yield debt, foreign debt, emerging markets debt, real estate, commodities, and precious metals. That's 12 categories right there, so with $1200, you're talking about $100 each. This is called asset allocation, and it's a step beyond simple "diversification", which most idiots think is buying a hardware tech stock AND a software tech stock.

Add systematically on a monthly basis. That means make sure you put the same amount of money in every month, no matter what. Soon you won't even care what any of the markets are doing. They're up? Great! Some of my investments are worth more. They're down? Great! Now I'm buying quality investments at an "on sale" price.

Then sit back and re-balance each year, back to your original percentages. Again, this is called asset allocation. It's is very important, perhaps the most important thing you can do with your money. The thinking being, what's BEEN hot is more than likely not going to STAY hot. All markets are cyclical. There's hundreds of years of data to back this up. Yet some people still think they can ride the next hot wave. They usually wind up begging on the street for beer money.

Now, this sort of portfolio should average 8-12% per year, so just split the difference and say 10% on average. Will it do 10% EVERY year? Of course not. I'd be surprised if it EVER did EXACTLY 10%. That's an annual average. With that average, your money should double roughly every 7 years.
So, if you're starting with $1200 or so like I said in my example, then in 7 years , even if you added no more money, you should have about $2,400
in 14 years you should have about $4,800
in 21 years you should have about $9,600
in 28 years you should have about $19,200
in 35 years you should have about $38,400
in 42 years you should have about $76,800
in 49 years you should have about $153,600
in 56 years you should have about $307,200
in 63 years you should have about $614,400
in 70 years you should have about $1,228,800!

Of course, if you keep adding money in that $100 a month, you'll become a millionaire MUCH sooner. The key is discipline, and sticking in when markets are up OR down. Don't try to time the market--you'll NEVER get it right.

By the way, here's a handy formula:

$100/month x 12% x 20 years = $100,000.

So if you need $300,000 in 20 years and have no idea how to get it, just save $300 a month and you're there. If you don't get 12%, you'll wind up with less naturally. But IF you still wind up with $250,000, I'd call that one hell of a failure.

Oh, and if you qualify on income limits (generally, if you're a single filer and make under $90,000/yr), and do this all in a Roth IRA? Then every penny will be 100% TAX-FREE. That's a deal that's too good to pass up. That's why I tell anyone who's under 30--if you make under $90,000, and therefore qualify to do a Roth, you'd be a fool not to. Just having the power of youth (and therefore time) on your side is such an advantage, to squander it would be such a waste!

Hope this helps!
--J.

Hi Ruppy, first of all if u r absolutely new to share market let me tell you that share markets are very volatile and for small and first time investors i prefer Mutual funds. Share Market can be viewed as a normal market wherein the shares are the products sold. Since you are new to the market u will not be knowing as to which sectors are booming and which sectors are stable. However if u deposit in Mutual Funds the entire tension as to invest in which sectors will be taken by the Fund Manager. The only thing that you have to decide is whether u want to invest for short term or long term. To understand how Mutual Funds work and make an analysis on that u can log on to Mutualfundsindia.com. investments in Mutual Funds not only secure ur money but also helps u earn good return.

start readimg economics time, and start watching CNBC and NDTV Profit.....slowly you will get to know all about stocks.

Open a brokerage account.

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