Individuals participating in the stock market have a desire to earn well. This is because the stock market is one of the most lucrative avenues for earning returns. Investing in equities can help provide better returns in comparison to other investment avenues. Most people who decide to enter the stock market ask one question- How to Earn 500 Rs Per Day in Share Market?
Most people fail to do so due to inadequate knowledge and experience. Given that the stock market functions for 252 days in one year. If you know How to Earn 500 Rs Per Day in Share Market means making a sum of INR 1,26,000 annually.
Implementation of requisite knowledge and a blend of correct strategies and discipline should help a trader make this money. The movement in the stock market is governed by several factors. These factors can be both domestic and international. Since most of these factors are situational, they cannot be controlled by the investors. However, smart investors can use these factors and can benefit from them.
Individuals need to keep in mind that the stock market is always right. This market gives you the opportunity for every trader to make profits, irrespective of the directions it goes to. Therefore, trading is nothing, but an art that is based on some strategy. For some people, trading means gambling and for some, it is considered a huge source of income.
Tips When You Start Trading For The First Time
Keep reading to find out How to Earn 500 Rs Per Day from Share Market?
1. Believe in booking small profits and consider doing multiple trades
Since the main intention here is to make regular income, it will be beneficial for the trader to focus on small profits and engage in multiple trades per day. Traders should know that it is very difficult to make 2%-3% profit frequently in one trade. However, if the trader focuses on increasing the number of winners and doing away with the size of the wins, he/she can earn the desired amount.
So, a trader is required to book profits whenever the opportunity arrives. This strategy can help traders because it is easier for one stock to make a move of INR3-5 per day. On the contrary, it is difficult to capitalize on the move of INR20-30 in one day. This is because smaller movements in price are more frequent in comparison to the big ones.
This is the first step traders need to keep in mind if they want to know How to Earn 500 Per Day from Share Market?
2. Focus on the shares having a high volume
This is the most important rule if you want to earn in intraday trading. Traders need to keep an eye on the shares having a high volume. Higher the liquidity, the better the chances of squaring off the position. Since an open position has to be closed before the market closes, the stock’s liquidity determines the possibility of making profits.
Traders need to take the appropriate time to scan stocks before investing. If a trader is confident, he/she can invest. They need to focus on the movements also. Make sure to assess the range of fluctuations in the chosen shares.
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3. Start trading in trending shares
Movement in either direction can be beneficial for a trader. This depends on whether a trader has taken a long position or a short position. Most of the time, intraday movements are because of specific news, which has a direct impact on the price.
News related to earnings, new orders, upgrades/downgrades by broking companies, announcements related to product launches, etc. is some of the critical and price-sensitive facts.
Tracking these types of daily news and then comprehending them can help traders to scan stocks and place trading bets. Trading in the shares which are trending will increase the probability of making profits. This should add to their daily income.
4. Focus on entry and exit points
Since we have talked about some critical factors which should help you earn, let us now talk about the entry and exit points. These are the two foundations of the stock market. Every trader needs to identify these points. Once this task is done, it becomes easy to benefit from the movements in the share prices.
Before placing the buy order, it is very important to determine the entry point and the price objective of the stock. If the stock trades below its price objective, it will be a good time to invest. This is because traders will benefit when the stock touches its price objective. Fixing the price objective should ensure that traders are not carried away with slight increases in the stock price.
4. Management of trading costs
Management of trading costs should help a trader in maximizing the quantum of daily profit. Every trader should be aware of the fact that each trade comes with a cost. These costs are incurred irrespective of profits or losses made in the trade. Trading costs consist of brokerage fees, SEBI charges, etc.
Some focus should also be on reducing trading costs. These costs can erode the profits that the trader has made. Therefore, a trader should consider opening a trading account with a discount broker. These brokers tend to charge low brokerage.
5. Take advantage of stop-loss
If you don’t set up a stop-loss, instead of searching for “How to Earn 500 Rupees”, you’ll be searching for how to stop losing money in the stock market. A most important aspect of intraday trading is making use of a stop-loss. This is one of the golden tips which can help traders to maximize profit.
Traders can decide on the percentage of stop loss that they want to apply. This depends on the risk appetite and the stock’s volatility. Making use of stop-loss can help in protecting the erosion of capital. This can also help to churn the money faster. This is essential for maximizing profitability in intraday trading.
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Bottomline
If you are planning to learn How to Earn 500 Rs Per Day in Share Market, you are part of the crowd. Many people are trying to figure out ways to achieve this. In a nutshell, some basic principles are required to be followed. Try selecting the stocks you plan to target and then track them for 2-3 weeks.
Gather all the information related to them, like their recent news or any upcoming product launches. Some traders also prefer to follow a trend. The chances of a trend reversal are minimal within the time gap of just one day. Therefore, the trend that the stock has made in the recent past is likely to be the same.
If you pick the right stock and the right strategy has been executed, you can generate profits even when the stock falls. This is called shorting. Thus, there are different strategies that can help traders to make money. A trader who knows how to use them can eventually end up making handsome profits.
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