How To Start Trading in Stock Market – Easy Guide For Beginners

Are you looking for an easy guide on how to start Trading?

The step-by-step guide on this page will show you how to start your career in trading even if you are a complete beginner and you don’t have to read long Trading Books to learn this skill.

What I can promise before you proceed further is that after completing this guide you will be able to place your first trade in the stock market.

This guide is designed especially for beginners. I will walk you through each and every step, using plenty of pictures and videos to make it all perfectly clear about Trading.

At any point in this guide, if you feel stuck or have any questions, simply send me a message and I will definately get back to help you out.

Let’s Start,

My name is Kamaljeet Singh, and I am going to show you how to start trading today. I have been into trading and investments since 2018 and made a full time career out of it.

I know that starting to trade online can seem overwhelming and intimidating. This free guide is all about how to start trading as a beginner even with little money, and will teach you how to become a successful trader by adopting the Trading Principles.

I am not afraid to admit that when I was learning to start trading I made a ton of mistakes. You can benefit from my experience so that you don’t repeat those same mistakes when you start your trading career. I created this free guide so that a complete beginner can learn to start trading in stock market of India.

Should You Start Trading?

There is no Doubt that Trading opens up a door for your financial growth but Before taking this decision, you should be ready to learn, adapt and understand the basic and fundamental concepts of Trading like Risk Tolerance, Money Management, Trading Strategies, Emotional Control, etc.

I know you might not understand these terms as a beginner but eventually you will get to know all these concepts. My personal recommendation is please focus on the Learning, markets are not going anywhere, they will stay there, so don’t rush for big profits soon, start small and focus on the returns in percentage.

Since Trading is a business where you can make money from money so another thing that you should consider before getting into real trading is having another stable source of Income.

Moreover, if you don’t want to risk your real money into the markets, then read this post on How to Paper Trade on Zerodha for Free.

What is Trading Anyway?

Online Trading is a process of Buying and Selling of an instrument like stocks and options to book the profits on price fluctuations.

For Example, if you Buy 1 quantity of a Share at price 100 Rupee and Sell it at the price of 120 rupees then you have booked a profit of 20 rupees that is 20% of your invsetment.

Similarly, if you Short Sell a share at 120 rupees and Buy it when price comes to 100 rupees then also you have made a profit of rupees 20.

This is the basic and simplest example to demonstrate how to book profit or loss in the Indian Share Market in cash stocks segment.

Types of Trading

Based on the Holding Time Duration and risks involved there are different types of Trading:

Intraday Trading

When you buy/sell and book the profit/loss in the same day. Hence, Buying and selling stocks within the same trading day is referred as Intraday Trading.

There are own benefits of this type of trading like Indian Brokers provide leverage for Intraday Trading for upto 5x. This means that even if you have 1000 rupees in your Demat Account, you can still buy or sell stocks worth 5000 Rupees.

Note: Profit or loss will be applicable on the 5x Margin Used. So, use the concept of leverage as per your risk ability and trade plan.

Delivery Trading

This type of trading involves Holding stocks for a few days or longer. For Example, if you Buy a Stock named “X” today and decide to sell it tomorrow, after a week or anytime later then this type of trading is called Delivery Trading.

Generally, you do not get margin benefit in this type of trading and has to pay full margin in cash required to purchase a particular stock at its current market price.

Futures and Options Trading

When you trade contracts based on future stock or Index Prices is referred to as FNO or Futures & Options Trading.

Trading in FNO involves high reward along with the high risk of your capital. It is not recommended for beginners to start their trading journey with this type of trading.

Trading in FNO requires complete knowledge of Options which is a different concept in itself. Still, if you want to try then go for Paper Trading First and learn all about Options Trading.

How To Start Trading in Stock Market

Now Onwards, I will walk you through simple and step by step guide to start trading and make your first trade in the Stock Segment.

It is recommended to follow each step practically to understand the basics of getting started and placing your trading order online:

Step 1: Choose a Broker Account

While choosing a broker people tend to prefer free brokerage account but remember cheap things are not always good and reliable.

There are two important aspects to consider while choosing the best stock broker:

1. Secured & Reliable.
2. Fast & User Friendly.

Based on these two aspects and my personal experience with different broker accounts I have listed below some of the best Brokers to make your trading journey fast, smooth and Secured.

Step 2: Set Up A Demat Account

To Set Up a Demat Account, click on any one of the broker links given below to open your Account.

>>Proceed With Dhan<<

Click and open the above link in a new and then watch the video given below for the steps ahead to create your Demat Account in Minutes.

Make sure to complete all the steps given in the video and then wait for 2-3 Working Days for activation of your demat account in Dhan.

You will receive an email confirmation upon successful activation of your account with you login id and password to get started ahead.

Step 3: Learn Fundamental & Technical Analysis

Fundamental & Techincal Analysis are two most important and decision making components of trading that every trader has to learn.

To be honest, it is not possible to explain everything about Fundamental & Technical Analysis here with just writing. So I have given a video below for you to deeply understand the concept to make informed and logical decision while Trading.

Fundamental Analysis invloves the study of a stock with the point of view of its details like Financial Goals, Quarter Earnings, Debt to Equity ratio and much more.

Learn in detail about Fundamental Analysis in the video below:

Technical Analysis involves the study of candles and chart patterns to decide for trend, entry and exits a particular trade.

Learn in detail about Technical Analysis in the video below:

Step 4: Create Trading Plan & Watchlist

After Learning the Fundamental & Techincal Analysis, I think you are ready to plan your trade and create the first watchlist.

First of All Decide your Entry Price and Target based on your research and then follow the process below to create watchlist and puch orders.

So let me show you how to create a watchlist and plan for your first trade in stock. Go to Watchlist section in Dhan and search your favourite stock.

After following the steps given, you will see the stock added to the watchlist as shown in screenshot above.

Step 5: Execute Trade Orders

To Execute a trade order. Click on the Stock you want to buy or sell. This will open up a new mini window to select the parameters to place your trade as shown in the image below.

For Demonstration purpose only, we have used Bharti Airtel Stock in the image above. In this window, select the quantity size you want to buy or sell based on fund in your account.

Then you have to select order type:

Market Order: Selecting this will execute your trade at the current Market Price on that particular time.

Limit Order: The Order will execute only when it hits the price that you set by yourself.

Trigger: Trigger price allows your buy or sell order become active for execution at the exchange servers.

Cover Order: Cover Intraday Order combines a buy order and a compulsory stop-loss order.

Bracket Order: You can set target and stoploss at the same time with this order type.

Based on your preference, select the order type and click on Instant Buy to Finally Punch and Complete Your Order.

Congratulations, You just placed you first Trade Order! Now make sure to keep a track of your active positions and decide for their target and stoploss. For that let’s understand Stop Loss and Targets.

Setting Stop Loss and Targets

It is very crucial to set the Stop Loss and Target limit in your open position in any stock or option to avoid unexpected losses.

A Stop Loss price acts as a kill switch when the price reaches your defined level and cuts the position automatically.

Similarily, A Target or take Profit acts as a price at which your goal is achieved and you want the system to book the profits automatically.

Important Steps as a Beginner Trader

A beginner trader always looks for a definitive roadmap to success and often encounters ways to get rich quick schemes, my recommendations is to stay away from the tips or recommendations based buying and selling until you understand the reason behind your trade.

Some of the Imprtant points that will help you keep the trading learning curve align are as follows;

1. Create a Trading Plan

To make a good plan for trading:

• Decide how much risk you’re comfortable with.
• Set your money goals and the ways you’ll trade.
• A smart plan can help you control your feelings.

2. Practice with Paper Trading

Try using paper trading before you use real money.

Zerodha Users Can Now Do Paper Trading for Free on Sensibull, Here’s How!

• This helps you learn how trading works without real risk.

3. Start with a Small Amount

At first, only invest a little money.

• As you get better and feel more sure, you can put in more money.

4. Keep An Eye On Financial News

Know what’s happening in the trading world:

• Watch the news about money to know what’s going on.
• Pay attention to updates from companies you like.

5. Take Help Of Trading Tools

Use websites and apps to get help with trading:

• Use stock market apps and websites like Chartink to build Screeners and strategies.

6. Handle Your Feelings

Trading can make you feel strong emotions. When you win some trades it will lead to overconfidence and lossing a trade can put play bad with your emotions. Learn to manage your feelings when you win or lose.

The best way to keep emotions and psychology under control is to keep your position sizing in control in such a way that profits or losses merely affect you.

Need More Help?

I hope this guide has answered any questions you had on how to start trading, but if any of the steps were unclear to you, you can contact me anytime and I will respond for sure.

More specific trading related tutorials can be found on my blog page. Here are some of the most popular tutorials from my blog:

• How to Get Tradingview Premium Account Free in India
• 10 Secret Trading Books To Master The Art Of Trading
• 5 Tips For An Option Buyer to Minimize Losses & Become Profitable
• What is India Vix & its Relation with the Market Fear & Volatilty?

Trading FAQs

Click on a question to read the answer: