Midway Securities Ltd. | Online Stock Broker: Buy and sell shares in the Dhaka Stock Exchange (DSE) using our world class platform, all available online!
  • Home
  • Log In
  • Open a BO Account
    • বিও অ্যাকাউন্ট খুলুন
    • Open Joint BO Account
    • NRB BO Account
  • Link Account
  • Mobile App
    • QuickTrade Pro
    • Midway Portal
    • i-Trade
  • Apply For IPO
  • Branches
  • Pricing
    • Pricing
    • প্রাইস
  • Deposit (টাকা জমা)
    • bKash, Nagad, Rocket
    • Credit Card (Deposit)
  • Withdraw (টাকা উত্তোলন)
  • FAQ
    • FAQ
    • বাংলা
    • Digital Booth FAQ
  • About Us
    • About Us
    • Our Services
    • Careers
    • Survey
    • Media
  • Foreign Investors
  • OTC Market
  • Contact Us
  • Form Download
  • Blog
  • Visual Research
  • G-Sec
  • Update Your Nominee

MIDWAY SECURITIES LTD.

DHAKA STOCK EXCHANGE LTD., TREC 142
শেয়ার বাজারে বিনিয়োগ সম্পর্কে এখানে জানুন। আমাদের রচনাগুলি আপনাকে নিরাপদে বিনিয়োগ করতে সহায়তা করবে।
বিও অ্যাকাউন্ট খুলুন
09609 100 142

Categories

All
ATB
Bonds
Dividend
IPO
Learn About Share Market
Margin Loan
Mobile App
Mutual Fund
Portfolio Transfer
Security
SME
বাংলা

Archives

May 2025
January 2025
November 2024
September 2024
July 2024
June 2024
May 2024
April 2024
March 2024
February 2024
December 2023
November 2023
October 2023
September 2023
June 2023
May 2023
April 2023
March 2023
February 2023
January 2023
November 2022
August 2022
July 2022
June 2022
March 2022
January 2022
September 2021
July 2021
April 2021
September 2020
August 2020
June 2020
May 2020
March 2020
February 2020
January 2020
December 2019
November 2019
July 2019
May 2019
March 2019
December 2018
November 2018
October 2018
September 2018
April 2018
March 2018
November 2017
September 2017
August 2017
July 2017

To make money investing in Stock Market, stay invested.

28/7/2019

0 Comments

 
Picture
The key to making money in stocks is remaining in the stock market; your length of “time in the market” is the best predictor of your total performance. Unfortunately, investors often move in and out of the stock market at the worst possible times, missing out on that annual return.
(First things first: You need a brokerage account to invest — and thus make money — in the stock market. If you don’t have one, here’s how to open one. It takes only 10 minutes to set up.)
More time equals more opportunity for your investments to go up. The best companies tend to increase their profits over time, and investors reward these greater earnings with a higher stock price. That higher price translates into a return for investors who own the stock.
More time in the market also allows you to collect dividends, if the company pays them. If you’re trading in and out of the market on a daily, weekly or monthly basis, you can kiss those dividends goodbye because you likely won’t own the stock at the critical points on the calendar to capture the payouts.

How to earn money from the share market
​
By investing in shares, one can earn either through capital appreciation, i.e., on the gains made on capital, or income in the form of dividends.
 
To earn money from the equity market by investing in shares listed on stock exchanges like Dhaka Stock Exchange (DSE) may look easy to some. After all, anyone can buy shares with the click of a button right? Well, not really.
 
Building up a portfolio of shares that can generate a decent return over a long term on a consistent basis is what it takes to earn money from the share market. However, the reality is that investing directly in the stock market may not be everybody's cup of tea as equity has always been a volatile asset class with no guarantee of returns. The only silver lining is that over longer period of time, equity has been able to deliver higher than inflation-adjusted returns among most asset classes.
 
First, we look at how money can be made by buying shares. There are two primary ways to earn money from shares - through capital appreciation and from dividends. 
Picture
​Earning from capital appreciation
By investing in shares, one can expect to earn through capital appreciation, i.e., on the gains made on the capital (principal invested) when the share price rises. The gains or the profits from shares can go as high as 100 percent or more. There is, however, no guarantee of capital appreciation. The probability of the market prices remaining lower than the buy price always exists.
 
Earning from dividends
Apart from capital gains on shares, investors may expect income in the form of dividends. A company distributes profits to its shareholders by declaring partial or full dividends. In most cases, the company partially distributes profits and keeps the rest for other purposes, such as expansion. The dividends are distributed per share. If a company decides to give Tk. 10 per share, and if the face value of the share is Tk. 10, it is called 100 per cent dividend.
 
The formula for computing the dividend yield is:
Dividend Yield = Cash Dividend per share / Market Price per share * 100.
So, if the market price is Tk. 120 and the dividend declared is Tk. 4 per share, the dividend yield is 3.33 percent.
 
By investing in shares, the risk of losing a major part of one's capital exists, unless one employs hedging mechanism including stop-loss in place to minimize the losses.
 
So, if you still want to earn money from stocks, here are a few things to know and be aware of to take informed investing decisions: 
Picture
​Share markets - primary and secondary
The stock market is divided into two main categories: primary and secondary market. In the primary market, securities are issued and subsequently listed on stock exchanges. Trading in these securities happens in the secondary market.
 
A public issue introduced in the primary market can be of two types-an initial public offering (IPO), or a follow-on public offering (FPO). An IPO is used when an unlisted company wants to raise equity capital by issuing shares. It results in the company's shares getting listed on a stock exchange. In an FPO, a listed company issues shares to the public. It can be either a fresh issue or an offer for sale (right shares).
 
Further, there are investors who look for fundamental strengths in a company's stock and invest for a medium to long term, while another type are the traders who look at technical charts to buy and sell during intra-day or over few days. As a retail investor, consider investing in shares for the long term keeping the fundamentals of the company in context. 
​Factors impacting share price
To earn money from direct equity, one needs to know the factors impacting the share price. A company's share price does not move independently. Several internal and external factors are responsible for it. When a company is expected to grow faster, more people want to hold the stock. This leads to higher demand for the stock in the market, which results in higher prices. Further, acquisition plans, PSI (price sensitive information), announcement of bonus, and splitting of share impact prices in the short term.
 
In addition, there are macroeconomic factors such as GDP, inflation, interest rates impacting performance and thereby stock prices. If the economy is doing well, the demand for goods and services will be higher, resulting in more profits for companies. Further, high inflation means higher prices and consumers will be able to buy fewer goods and services, hurting company's sales and profits.
Picture
Number crunching 
Stocks selection requires knowledge of a vast range of subjects such as economics, finance, and corporate law. However, if you lack rigorous training in these subjects you can use some basic principles. First of all, you should try to understand the company's business. You should read the company's financial statements such as income statement, balance sheet, and cash flows. Don't just focus on earnings. Balance sheet and cash flows are even more important.
 
After you have analyzed the company's financial health, look at its valuation. Strong balance sheet numbers coupled with lower valuations compared to peers or the index makes a strong case to buy. You can use various sources to gather information on stocks. The first one is the website of the exchange where the stock is listed. Here, you can find financial results and company announcements. Companies also publish their financials on their websites. 

Building a diversified portfolio
Start by putting your money in different stocks, which is also called diversification. This diversification should happen across sectors and also across market capitalization of stocks. Concentrating in one sector or putting all your funds in mid-cap stocks may not be the right thing to do.
 
Diversifying across sectors or industries helps if the economic environment is not favorable for any one sector as each sector has its own typical set of factors that impact the performance of companies. These include the economic environment, cyclical nature of business and the government policies. By diversifying, one is actually creating a share portfolio, the overall return of which matters and not return from any 1-2 stock out of it.
 
For starters, it's better to stick to large-cap stocks which mostly comprise the index. The mid-cap index can be a good starting point for buying into mid-cap stocks. Over time, one may look at other emerging companies but only after careful analysis. Ideally, small-caps should form just a small portion.
Picture
​Never try to time the market
Buying low and selling high is always a dream of every investor. However, knowing the bottom or the peak in a stock's history always comes to be known in hindsight. Rather than trying to time the market, focus on the time spent in the market. Waiting for the stock price to lower further down may not even come and many investors are left out in the waiting game. It's better to stagger one's investment at different price levels.
 
Avoid herd mentality
When the stock price shoots up, many investors feel left out. At times, without understanding the business and the company financials, new investors jump on as herd mentality takes over. Such a move can be financially damaging as it may amount to pure speculation and most investors could be at the mercy of big operators.
 
Further, when stock prices decline hugely in a span of few days, there could be unanswered questions and fear factors leading to its fall. The price reversal can be equally swift. Avoid the temptation to take decisions based on rumors or speculative reports.
 
Finally, when the markets are in the grip of bears and stocks keep falling for days together, herd mentality caves in. The world's greatest investor, Warren Buffett, was surely not wrong when he said, "Be fearful when others are greedy, and be greedy when others are fearful!"
 
Keep emotion away
Keep emotional reasoning away while taking investing decisions in shares. Many investors have been losing money in stock markets due to their inability to control emotions, particularly fear and greed. In a bull market, the lure of quick wealth is difficult to resist, while in a bear market when prices crash, the fear takes over and investors sell even at huge losses.
 
When to sell
At times, stock markets could remain flat for a long period, while at other times it can be extremely volatile. Your decision to exit should ideally not be based on short-term market movements rather on your stock selection. If there are no fundamental changes in your stocks, including its financials and businesses, stick to it. Risk is inherent while investing in stocks and hence, one should be able to stomach the risk of seeing the share price slide down considerably. Keep some portion of cash in hand to make use of market opportunities. If your stock has performed well, booking profits may not be bad idea.
0 Comments



Leave a Reply.

    Author

    The Midway Team

    Categories

    All
    ATB
    Bonds
    Dividend
    IPO
    Learn About Share Market
    Margin Loan
    Mobile App
    Mutual Fund
    Portfolio Transfer
    Security
    SME
    বাংলা

    Archives

    May 2025
    January 2025
    November 2024
    September 2024
    July 2024
    June 2024
    May 2024
    April 2024
    March 2024
    February 2024
    December 2023
    November 2023
    October 2023
    September 2023
    June 2023
    May 2023
    April 2023
    March 2023
    February 2023
    January 2023
    November 2022
    August 2022
    July 2022
    June 2022
    March 2022
    January 2022
    September 2021
    July 2021
    April 2021
    September 2020
    August 2020
    June 2020
    May 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    July 2019
    May 2019
    March 2019
    December 2018
    November 2018
    October 2018
    September 2018
    April 2018
    March 2018
    November 2017
    September 2017
    August 2017
    July 2017

    RSS Feed

  • ​বিও অ্যাকাউন্ট খুলুন
  • Open BO Account
  • ​Link (লিংক) Account
  • IPO
  • Mobile App ​​
  • Pricing / প্রাইস
  • Withdraw (টাকা উত্তোলন)​
  • Deposit (টাকা জমা)​
  • Branches
  • FAQ
  • ​Contact Us​
  • Our Services
  • ​About Us
  • Blog
  • Market News
Dhaka Stock Exchange Building (Room No: 508)
9/F, Motijheel C/A, Dhaka 1000
Hotline: 09609 100 142
​[email protected]
Copyright Midway Securities Ltd. © 2024
Dhaka Stock Exchange Ltd.
Terms & Conditions
​Privacy Policy
  • Home
  • Log In
  • Open a BO Account
    • বিও অ্যাকাউন্ট খুলুন
    • Open Joint BO Account
    • NRB BO Account
  • Link Account
  • Mobile App
    • QuickTrade Pro
    • Midway Portal
    • i-Trade
  • Apply For IPO
  • Branches
  • Pricing
    • Pricing
    • প্রাইস
  • Deposit (টাকা জমা)
    • bKash, Nagad, Rocket
    • Credit Card (Deposit)
  • Withdraw (টাকা উত্তোলন)
  • FAQ
    • FAQ
    • বাংলা
    • Digital Booth FAQ
  • About Us
    • About Us
    • Our Services
    • Careers
    • Survey
    • Media
  • Foreign Investors
  • OTC Market
  • Contact Us
  • Form Download
  • Blog
  • Visual Research
  • G-Sec
  • Update Your Nominee