How To Purchase Shares? A Simple Step-by-Step Guide.

Shares, which is a small word but if you are aware of it then it is good. But if you are not aware of it or have incomplete information, then it can be quite dangerous. You should know about How To Purchase Shares?

Well, In today's blog, I’m going to talk about what is Shares? What are Share Market? What are the simple steps to purchase shares? And why is it so important? - We are going to give complete information about it.

Yes, because we all earn money by working day and night so that we can have a better lifestyle.

But when it comes to saving, it seems very difficult to save anything from the money earned and hence saving is never possible.

But we all know that savings helps us during our difficult times, that's why saving money is very important.

In such a situation, there are many options to save money, but an interesting and effective way is to buy shares.

Due to which the money is not only saved but also you increase it. So, in such a situation, you must take the information related to buying shares or to purchase shares.

And today, Growwpedia has brought you complete information related to buying shares so that you can know what shares are?

How to buy them? and what to keep in mind while buying shares? So that you can earn more and more profit.

So let's start and first of all know what exactly shares are and what is share market?

What is Shares?

Share is also called by stock or equity, Share means taking stock of a company. That is, if you have shares of a company, then you become the owner of that much amount of shares that you have purchased from the company.

Some investors also employ tools like forex ea to automate and optimize their trading strategies, enhancing the efficiency of their investment decisions.

And in this way you become a shareholder in a company. After you buy the shares of a company, you get all the rights that one shareholder has.

You can buy your shares from the stock market and you can also sell it too.

What is Share Market & How to Purchase Shares?

Whenever we hear the name of the market, we imagine like there is a big market in which there will be many shops. 

But the share market is completely different from this imagination. Buying and selling shares in a stock market is done entirely by computer. 

And if we talk about the process of buying shares in the share market, then it is a little different.

Here there are brokers who are members of the stock exchange and they have the right to trade on the stock exchange.

Customers cannot go directly to buy or sell shares, But with the help of a broker this work can be completed.

Now the next question arises here? where are the shares that are said to be bought and sold? Then the answer is that the work of buying and selling shares is done in the stock market.

And in India, this work is done on the two stock exchanges i.e. BSE (Bombay Stock Exchange) and NSE (National Stock Exchange). So these two are considered the world's largest stock exchanges.

Approx. 25 stock exchanges exist in India right now. And most of the companies whose shares are bought and sold in the market are listed on either of these two stock exchanges or on both the stock exchanges.

After you know this much, you must have understood that buying shares is not so much a difficult task, but an interesting and profitable job.

So now let’s further talk about How To Purchase Shares? i.e. what is the actual process of buying shares.

How to Purchase Shares?

Let’s understand with simple step-by-step.

Step 1:  You Must Have a Pan Card

In the process of buying shares, you will need a PAN card for financial transactions, so first prepare your PAN card.

Step 2:  Meet Brokers

You must have known that you cannot directly do the work of buying and selling shares, but it can happen only with the help of a broker that work can be done in the share market.

Therefore, you can meet a broker, a broker can be a person or it can be a company or online agency which is valid by SEBI.

In order to entice the customer many brokerage firms make different brokerage schemes which have different fees which range from 0.01% to 0.05%.

Some brokerages charge at a flat rate, so it is important to choose the broker very wisely.

Step 3:  Create your DEMAT & Trading Account

After selecting a broker, you should also have a DEMATE and trading account, only then you will be able to buy and sell the shares.

Your shares in DEMATE account remain in electronic format and through Trading account you can buy and sell shares.

According to SEBI Guideline in India, DEMAT Service offers by two organizations, NSDL (The National securities depository limited) or CDSL (central depository services limited).

So both these institutions are called Depositories. To open both these accounts, you just have to go to your broker or brokerage firm where both your accounts will be opened easily.

Step 4:  Buy Stock

You have chosen a broker and you also have a PAN card, Demat account and trading account too, so now it is time to buy shares.

At the time of buying shares, you can place orders in 2 ways i.e. at market rate and limited rate. Market rate means buying at the same rate at which the stock is trading in the stock market.

Whereas the limited rate means that you can tell a limit so that at a higher rate, the broker will not buy the shares for you.

Step 5:  Getting Dividend

Dividend means a portion, which is given by the company to the shareholders. Whose shares are bought by shareholders. The portion of the profit of the company which gets from these shares is called dividend.

It is the right of the shareholder to receive the dividend on his terms. This can be in the form of dividend cash or stock. 

And if the dividend is in the cash form, Then this will directly reach your bank account.

With the understanding of this easy process of buying shares, let us also know a little about selling shares.

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How To Sell Shares?

So if you want to sell shares, then the shares you want to sell should be in your DEMATE account. 

After this, as soon as you sell shares with the help of a broker, those shares will be removed from your DEMATE account. And in about 3 days, the amount of shares you sold will reach your account.

The broker's share will be deducted from this amount and you will get the final amount after deduction directly to your bank.

In how many days the amount of sold shares will come in your account, it will depend on the category of the share.

Let’s also know from which companies you should buy shares initially.

Blue Chip shares and FMCG shares have always been investors' choices. While large-cap shares reduce investment risk & mid-cap and small-cap shares have higher growth potential.

It is also important to know what things should be kept in mind while buying the shares of a company.

What to Keep in Mind While Purchasing Shares?

At the time of buying the shares of any company, you will have to consider all these things so that your savings can be found in the right place and you can get maximum profit.

Check that the company has remained Financially strong in the last 3 to 5 years or not. And you can also check the company's monthly based record in which you get to know many things like,

• How much is the EPS?
• How much is the book value?
• What is the PE ratio?
• Whether the company is giving dividends continuously or not?

You should research & check all these things.

Apart from this, you can also read the balance sheet of the company. You must also take this information, what kind of services does that company provide.

After so much information, when you feel that the company is in profit, then only you buy its shares.

By the way, another important question is how much money you must have to invest in the stock market? And the answer is very interesting.

There is no limit of money to invest in the stock market, here you can start from one rupee also. That is, whatever money you have in your pocket, you can start with that in the stock market.

You just need to have a Proper guideline to invest your money in the right place, So that every rupee you’ve invested can give you a profit.

Now let's talk about How To buy shares online.

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How To Purchase Shares Online?

If you want to buy shares online, choose a good broker, get a PAN card, create a DEMAT and trading account, create a savings account, So that money can be easily transferred to the broker's account.

Tell the broker which shares you want to buy at which price. While buying shares online, keep the correct information of the broker's software, so that you can avoid making wrong orders.

100% Trusted & Best Sites To Purchase Shares Online in India: