How to Invest in Share Market: A Complete Step-by-Step Guide

invest in share market

Whenever we think about investing, the Share Market or Stock Market comes to mind. Of course, there is no better place than the stock market to invest our hard-earned money and get better returns than other investments.

There is no minimum amount required to invest in share market like properties and other assets. You can start your investing career at just 5k-6k Rupees.

Everybody wants to make money by investing in the stock market but most people fear losing money in the stock market. The key to a successful investing career is not to avoid risk but manage the risk.

The first step towards a successful investing career is to start early. The best day to start investing is today. 


How to Invest in Share Market: A Complete Step-by-Step Guide


If you have already decided to invest in the share market, then the second step is to decide whether you want to pick your own stocks or you don’t have enough knowledge to pick stocks on your own.

invest in share market

How to Invest in Share Market if You are totally Beginner

If you don’t have enough knowledge or time to pick stocks and manage your portfolio then it is far better to invest in share market via a mutual fund than picking stocks on your own.

Mutual fund

A mutual fund is a type of fund managed by an Asset Management Company (AMC). A mutual fund is a pool of funds, funded by investors and that fund is managed by a professional.


mutual fund


The professional who manages mutual funds is called the fund manager, for managing the fund they charge some commission.

Invest in a mutual fund

You can directly invest in a mutual fund. Nowadays there are a lot of mobile apps by which you can directly buy mutual funds online with your smartphone.

The Groww app is the best platform for mutual funds where you can buy mutual funds without paying any type of commission.

The verification process to sign up on the Groww is very simple and there is no paperwork. All the processes are online. If you have all the valid documents your account will be activated within a few minutes.

There is no maintenance or annual charges in the Groww app, which is also a huge advantage to save and invest more money.


Read Also; Groww Mutual Funds Investing App Review and Comparison


Demat and trading account for a mutual fund

It’s not compulsory to open a Demat and trading account for buying and holding mutual funds. You can directly buy a mutual fund from any asset management company (AMC).


Types of mutual funds

Basically there are two types of Equity Mutual funds.

1. Actively Managed fund and

2. Passively managed fund.


If you can make an effort for finding a good mutual fund, then go for it, otherwise, it’s always better to invest in a passive managed fund i.e. index fund.

The nifty-Index fund is the best index fund. It’s well-diversified. The expense ratio of index funds is almost negligible which is also a huge advantage.


Return from mutual funds

By buying an index fund you simply bet on the whole market it means you don’t need to worry about your return and market return. Your returns will be the same as market return.


Invest in share market by picking your own stocks

If you want to make an effort and learn to pick good stocks then go for it.

First, you need to get a stockbroker and open a Demat & trading account.



An individual can’t go directly to the stock market to buy or sell shares. Buying and selling of stocks must be done through a stockbroker. They are people, organizations, or offices enrolled with and approved by Sebi. Stock Brokers charge some fees known as brokerage charges.


Demat and trading account

Demat account is simply an account where your shares are stored in digital form. From the word “trade” in the trading account, it is obvious that it is used for buying and selling shares in the stock market.

Whenever we buy shares from the market through our trading account it is automatically credited in the Demat account and vice-versa. We can also track our portfolio from the trading account in this way we have not much to do with the Demat account.

You can open a Demat and trading account with a stockbroker.


You don’t need to open your Demat and trading account with a full-service broker if you are just a beginner.

You can go to a discount broker. They charge minimum even some brokers allow investing at zero brokerage. It means they will not charge any commission for investing.

Zerodha is the best discount broker in the industry of discount brokers. You can start investing by just downloading the Zerodha Kite app after completing the account opening process.

Click Here and sign up at Zerodha and start investing today.


Pick Your first Stock

The most exciting and at the same time anxious day of any amateur investor is the day when they pick their first stock because they are going through both fear and greed.


Which stock should you buy?

There are more than 5000 listed companies in India. But which company should you own? This basic question comes to every investors’ mind every time whenever they want to invest money. Choosing a good company stock at the best price is the only thing we have to consider before making an investment.

But which company is good and available at a fair price? For this, every investor makes their best effort in research and analysis in finding good companies’ stocks.


Don’t worry follow this Checklist to pick your first stock

  • Make a list of India’s topmost reputed public companies. It means the companies at which you have trust and the promoters have a good reputation. Make sure that your investment is safe in this company.
  • Select companies that have at least 10 years of track record.

  • Make sure that the company has very low debt or debt-free.
  • Avoid cyclic companies. (Cyclical companies are those companies which are affected by major economic factors)
  • Select the company of which product or service you use personally.
  • The company’s sales and profits are increasing.
  • Avoid both low PE and high PE ratio companies.
  • The company should have a good Return on Equity. For this, You can compare one company from another company in the same sector.


Although, this is not an exact way to find a good company to invest in share market but by following the above checklist you can at least protect yourself from any serious losses.


Also Read;


Some Don’ts

  • Never invest borrowed money in the share market.
  • Avoid intraday trading and other instruments of the derivative market i.e. future and options.
  • Never put all your money into one company.
  • Avoid frequent trading, more trade will result in more loss.
  • Never rely wholly on free tips, do your own research. At least go throw the above checklist.
  • Never quit if you have lost some money.


  • If you have any debt then first pay that debt.
  • Keep enough general expenses fund and emergency funds for the next two years.
  • Start with a small amount. In starting, invest more in mutual funds.
  • Diversify your portfolio, as a beginner, you should own at least 10 and maximum 30 stocks.
  • Start Reading companies’ balance sheets, annual reports, presentations, and conference calls.
  • Stay updated with your investment.
  • Focus on learning. Read some good books and business magazines on the stock market, business, and economics.


Final thoughts

The stock market is not a money-making machine. You will not become a millionaire tomorrow. It takes years of patience and experience to earn a huge amount of money.

Keep in mind that almost everybody loses money in the stock market in the beginning. So don’t worry too much if you have lost some money. Ask yourself why are you losing money?

Keep Learning, Keep Investing!

Read more about stock market.


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