Guys dont feel negative because one post is dedicated for dis advantages alone. Its always important to know the pit falls as well. Knowing the disadvantages itself is an advantage. Let us see them one by one..
1.Investment:
+ You need to wait for long time for your money to make some decent growth. This term "long" differs based on what you expect.
+You need to spend some quality time in knowing the companies in which you want to invest and then decide.
+ You also need to know the fundamentals(Basic functioning ) as well as the technical strengths(current market positions) of the company.
2. Day Trading:
+ You should be experienced enough to step into this Day trading all alone or you will loose all the money..yeah it will eat up your money if you are not clear in what your doing and what do you want.
+ You should be quick enough in making decisions and predicting the direction in which the stock value of a particular company is moving.
+ You should spend all the days time in trading i.e. till the trading for the day closes.
+ If you dont close the trade by the closing time you would have to pay some huge amount for carrying over it to the next day. Be aware of this!
3. Speculation ... Sorry :P Please never think of this.
Common thinks that you need to generally look for while doing stock trading/investment are
+ Any global changes that would affect the stock Eg: Increase in crude oil price,Gulf wars or any natural disaster ..etc
+ Any goverment decisions against or infavour of market. Eg: Taxing scheme , budget etc
+Any sector wise changes Eg: raise in steel and cement price will affect InfraStructure sector, if world bank rejects/delays some loan sanctions,this will affect banking sector .
And many more ... we will discuss them as we move on .....
Lets understand the basics of mutual funds in the next post .. :P
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