What is trade in stock ?

Trade in stock
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When an investor invests in the stock market and they buy and sell stocks that will be a transaction. And that transaction call as one trade. That means when investors buy and sell stocks this is called trading. In this article we will discuss all about trade in stock, how stock trading works, type of trading etc.

Table of Contents

  • What is stock trading ?
  • How stock trading work?
  • Types of stock trading strategies
  • Tips of trading stock 
  • Conclusion
  • FAQs

What is stock trading ?

Stock trading is when investors buy and sell stocks in the stock market publicly in a company which is listed in the stock exchange. When investors buy stocks, that means they buy a small piece of ownership of that company. As per company performance your stock value also goes up or down. 

How stock trading work?

Stock market is a marketplace where buyers and sellers come to trade in the stock market. When a buyer places an order that order will execute when at the same time the seller placed a seller order. It should match the seller with the buyer price then both orders will execute. 

When investors want to buy or sell stocks in the stock market they need a broker. Broker who is the mediator to execute orders between seller, buyer, and broker will execute orders behalf of investors. Brokers can be full time services or discount brokers. Full time service brokers will provide more service with higher cost they charge. 

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Opening an account with Upstox is fast, easy, and completely online. With Upstox, 

Types of stock Trading Strategies

There are many types of stock trading strategies, each strategy has its own risk and reward. 

Here are some strategy:

Value Investing

Value investing means you will find those stocks which are undervalued based on their intrinsic value. And invest in this type of stock for a long time, wait for the true value of that stock. 

Growth Investment

Growth investing strategy is to find out those companies which growth rate faster than average growth rate of those same industries. You need to find out about these stocks and invest in them. These companies basically reinvest their profit back into their business. Or these companies pay dividends to their shareholders. 

Income Investment

Income investing strategy follows those stocks who pay a dividend to their stockholder. You need to find out those stocks who pay a dividend that will be your regular income. You will receive quarterly or yearly dividend, it can be your passive income

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Day Trading

Day trading strategy follows you will buy and sell stock within a day, that is also called intraday trading. So here is your investment goal for the short term. But day trading is full of volatility with risk. 

Tips of Trading Stocks

Do your research

Before investing in the stock market you need to research that company’s stocks. Analysis financial report, growth rate, revenue percentage etc. 

Have a plan

Have a strong plan before investing in the stock market. Set an investment goal so that you can stay a long time in the stock market. You need to find your own strategy with an investment goal. 

Diversify your Portfolio

Investing in a variety of stocks with different industries and sectors you can minimise your risk and make a diversified portfolio. 

Stay update on market News

As an investor you need to always stay updated on market news, and know about market trends, company reports, and upcoming events. It will help you make decisions about investing in the stock market.

conclusion

Trading in stock market can be an exciting way to make profit, but it is important to know about the stock market, trading strategy, and some tips of trading research on companies.it will help you to build a good portfolio. 

Demat account

FAQs

Stock is a small piece of ownership in a company that investors can buy and sell publicly in the stock market. 

You can buy stocks in the stock market through brokers online. You need to open a demat account online and activate your account after that you can buy stocks in stock market.

Full service brokers come with more services with higher charges, while discount brokers provide limited services with low brokerage charges. 

Day trading is when investors buy and sell stocks in the stock market within the same trading day. It is a short term trading strategy. It is also called Intraday trading. 

Yes, stock trading can be risky, as per market performance the stock value will go up and down. You need to research the company properly before investing in the stock market. 

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