Stocking up plans

The stock market — well,  there is no other place where dreams come true as easily or get shattered so fast! Experts and financial gurus may be able to make sense of the zigzag arrows and blinking numbers but for others, it is akin to watching a foreign movie without subtitles. You know something exciting is happening but can’t understand what.

In cities like ours, where the proportion of youngsters and the disposable income in their hands is high, many still prefer the more traditional options like bank deposits and gold for investing. Reasons for this range from lack of knowledge in the stock market sector and lack of a risk-taking appetite to dearth of sufficient interest.

“I have absolutely no idea about the stock market and the terms used there. It is not a game of luck, as many say,” says Anindhita Ramachandran, who works in a publishing house. “You need to know what you are doing. Right now, I prefer to invest in something that is not so risky. Maybe later I will try my luck in the stock market, when I learn more about it.”

Such apprehensions are very common, according to Kishore, co-founder of the Stock Market Institute. “Risk is the main reason for people to shy away from putting their money in shares. And they also complain that the entire process is too complicated. How do you choose one company to park your funds in, from the numerous ones on offer?” The opinions of others too greatly influence a person’s decisions.

    “Friends and family nearly always discourage a first-timer from getting into trading. They equate it to gambling and recount their personal experiences about losing money,” says Kishore. To combat these misgivings, the institute offers financial literacy classes and courses for students and professionals. “Almost 50% of our students are youngsters,” says Kishore. “Some of our students were so taken in by the world of trading that they went on to complete our certified courses and are now working with top brokerages and other such firms.”

That many youngsters are enamoured by the nitty gritties of shares and derivatives can be made out from a survey. According to a recent ASSOCHAM study, there is a rise of over 76% in online trading among young investors in the last couple of years as a source of additional income. The easy availability of gadgets, rising speed of the internet and use of superior technology have helped in this phenomenon.

“We may burn our fingers initially in the share market but that is not a reason to lose hope,” says Rahul Sankar, who was bitten by the online trading bug a few years ago. “When the value of your holdings increases or decreases, you need to learn what is happening. Maybe the entire market saw a rise or dip, or maybe it was sector specific or maybe it was something to do with that one particular company itself. Understanding breeds knowledge which in turn leads to expertise,” he says. Kishore concurs.

“Investments should be properly planned. It is possible to mitigate or calculate risk. For that, learning is the first step and it is never too late to start,” he says. His institute has classes for school children too, where they learn the basics of finances and how to budget their pocket money. “Parents want them to have financial literacy. Thinking about finance and investment is essential for a better future,” says Kishore.

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