I Want Invest Money In Share Market – How to invest Rs 10000 in India for high returns for beginners: Investment is the only way to grow your hard earned money continuously. Gone are the days when people buried their wealth beneath their land. Rising inflation and increased consumerism have created a need to invest today.
However, when we look around, very few people do not know how to invest their money wisely. Many people are not even aware of the various investment options available in India. Today we are going to discuss how to invest Rs 10000 in India for maximum returns. Continue reading.
I Want Invest Money In Share Market
There are multiple investment options in India to invest Rs 10,000 or more to get moderate to high returns. Here are some popular investment options and expected average annual returns in India:
How To Invest In Stocks: A Beginner’s Guide
“How many millionaires do you know who got rich investing in savings accounts? I rest my case. ” – Robert G. Allen
Etc. However, apart from cryptocurrencies, all these other options may not be feasible for an investment of Rs 10,000 in India.
Now, let’s get to the answer to the central question of this article, i.e. How to invest Rs 10,000 in India for high returns? Among all the options mentioned above, investing in the stock market is one that has outperformed all other investment options over a long period of time. So, the best option to get the most out of an investment of Rs 10,000 is the stock market. If you are prepared to invest smartly, it pays off.
Here is a graphical comparison of the returns of Gold vs. Nifty index for the last 10 years.
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Now Let’s analyze the Indian stock market and find out how much return you could have made if you had invested Rs 10,000 in a few popular companies, five years ago, in terms of their absolute returns.
Here are some tips on how to invest Rs 10000 in stocks in India to get maximum returns:
This is a basic but most important tip that any stock market investor should know. If you don’t want to rely on your luck, research the company before investing. Also, invest in the company, not the stock price. If the company is doing great, the stock will do well. Research the company thoroughly before buying shares.
First understand the company. Learn about its products, services, business model, competitors, industry, founders, management team, competitive advantages and more. In short, study the fundamentals of the company before investing.
Workshop On Share Market & Investment
If you want to read more about how to choose stocks, you can read more here: How to choose stocks to invest in Indian stock market for consistent returns?
Growth stocks are companies that are growing at a faster rate in terms of revenue and profits compared to their competitors or the industry average. Growth stocks may be riskier compared to value or dividend stocks but the latter are reputable companies and pay dividends regularly, however, the returns from dividends are less.
On the other hand, growth stocks do not pay any dividends to their shareholders, but the capital appreciation may increase in relation to the increase in share price as growth stocks reinvest all their profits. soon
. However, in reality, if maximum benefits are expected from small investments, the concept is different. Don’t diversify your portfolio when you invest only Rs 10,000. Instead, invest in one or two stocks at most.
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Diversification is used when you invest a large sum of Rs.1 lakh or more. It is the big bets that can help you get big returns with small funds. Diversification destroys profits when the investment amount is small.
Let’s understand this with an example. Imagine, you invested Rs 10,000 in good stocks. Then, the total benefit amount will be Rs. 15,000.
Let us assume another scenario where you have invested Rs 10,000 in 3 stocks. After one year the return on stocks is +10%, +50% and +15%. The total benefit amount will be Rs 12,500 (+25%). All three stocks cannot provide equal benefits and one of them may be the strongest. If you invested in the strongest of the three, you would be able to get a double return (25% to 50%) on your investment.
Besides, there is not much to lose for small investments like Rs.10,000. People diversify their portfolios so that they don’t lose lakhs of rupees (and go bankrupt) if their investment strategies fail. However, if you intend to invest Rs.10,000; Then the reason for the investment should be that you have extra savings and want to get higher returns on the investment. In such cases, go for a big sure shot.
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As popular stock market investor and author of “The Business Investor” Mohnish Pabrai said “Bet few, bet big, bet rarely”.
You don’t need to find a hidden stash that you don’t know about to reap the multi-bagger benefits. There are a number of well-known stocks (Eicher Motors, Symphony, Page Industries, MRF, etc.) that have delivered multiple returns in the past and will continue to do so in the future.
Find a company that grows around you. Study if they are listed on the stock exchange. Learn the basics of those sections. If they are fundamentally healthy, invest in stocks. This is an effective way for common investors to find multi-bagger stocks. This concept has been discussed by popular fund manager Peter Lynch in his best selling book ‘ONE UP ON WALL STREET’.
These companies have the potential to become large-scale companies in the long-term framework. Compared to large caps that have already reached saturation, they have higher growth rates and chances of large caps delivering multi-term returns are very low. In addition, mid-cap companies have good capital to avoid debt and have a long life. A good growing mid-cap stock can easily become a multi-bagger.
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Few people can advise investing in penny stocks or small stocks to get higher returns. However, for small caps, the probability of the company going broke is also high. Most small-scale companies cannot sustain themselves in the tough economic conditions that occur once or twice in the long run. Therefore, investing in small-cap companies carries more risk than reward.
Many people have this idea of judging investment results by how long it takes to double their money. It’s a simple line of thinking, but it’s also a dangerous one. One way to learn how to double money is to follow the Rule of 72. Divide the number by the return you hope to earn. For example, it will take approx. If you earn 10% interest every year it will take 7.2 years to double your money.
In this article we discussed how to invest Rs 10000 in India for maximum returns. 10,000 rupees is not a huge amount, but if invested in the right company, the returns can be huge. Every day we see thousands of cases where investors with small amount of investment are able to invest for a long time and earn big money in the stock market. So, buy right and sit tight!
That’s it for this post. Comment below what you think about the strategies discussed in this post on how to invest Rs 10,000 in Indian stock market. Also, if you have any doubts or queries, feel free to post them below. We will be happy to help you. Have a great day and happy investing.
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Merchant Brain and Fingrad. He is an NSE Certified Stock Fundamental Analyst with +7 years of experience in stock market investing. Kritesh frequently writes about Share Market Investing and IPOs and posts his personal insights on the market.
Want to learn stock market trading and investing? Be sure to check out the exclusive stock market courses at Trade Brains’ learning initiative, FinGrad. You can register for FinGrad’s free courses and webinars today and get ahead in your trading career. JOIN NOW!!Investing is a time-tested way to put your money to work for you, as you work to earn more. Legendary investor Warren Buffett defined investing as “giving up consumption now in order to gain the ability to consume more later”.
By investing your money regularly, you will be able to multiply it many times over time. So it is important to start investing as early as possible and as soon as you save some money for it. Also, the stock market is a good place to start.
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Whether you have $1,000 set aside or can manage
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