Stock Markets at an All-Time High. How Can You Make the Most of the Rally?

Equity investing is gaining popularity as the stock market is rising on positive market sentiments. Know how to capitalise on the growth.

Positive market sentiments, a booming economy, and strong international relations are some factors driving the stock market rally. A couple of years ago, the stock market crashed as the COVID pandemic hit India. However, today, it has come a long way and has scaled new peaks. If you are also looking to ride the stock market boom and earn attractive returns, you can invest in the equity market. However, with the inherent volatility risks, you need a few aces up your sleeve to beat volatility and earn good returns. 

• The share market is at an all-time high driven by positive market sentiments
• As investors throng to invest in the rising stock market, some tips can help in avoiding possible mistakes
• Some investment tips include patience, long-term horizon, proper stock selection, and risk assessment.
• You can use these tips for effective equity investing and earn good returns while minimising the inherent risks

Stock Market Performance Since the Pandemic

Here's how the stock market has been on a roller coaster ride since the pandemic struck -

• From its peak in February 2020, the stock market crashed by more than 34% by March 2020 as the pandemic hit
• The number of active Demat accounts increased by more than 300% within four years. It was 35 million in the financial year 2019 and now stands at 115 million in the financial year 2023
• Between January 2022 and March 2023, there was the highest outflow of FII (Foreign Institutional Investment) from the stock market but the outflow did not affect investors who stayed invested.
• The stock market rally started in April 2023 and by June 2023, the Sensex had crossed major milestones to reach an all-time high of 67K

As the stock market is poised to grow further, existing and new investors can ride the rally and capitalise on the returns. 

That being said, the stock market is a risky avenue and you need to keep some points in mind when investing. So, here’s a look at some useful tips that can simplify your equity investing game and help you earn good returns.

• Be patient

Be patient during sharp market fluctuations. Do not panic and sell.

• Have a long-term horizon

While the stock market is volatile, the volatility is only short-lived. That is why it is advised to invest in the stock market with a long-term perspective.

• Choose the right stocks

Do your research before investing in any company. Don’t invest in any hot tip or in any stock that your friends or family recommend without doing your research.

Also Read – Is it time for new age stocks to grow?

• Know your risk appetite 

Know your risk-taking ability and invest accordingly.

• Diversify 

Choose stocks across market capitalisations and sectors for a diversified portfolio.

Click here to read the latest articles on Stocks 

The Bottom Line 

Simplify stock investing and use these tips to invest prudently. Ride the stock market boom and create a sufficient corpus for your financial goals.

Also Read – Do you know about circuit breakers in stocks?

Disclaimer: This article is intended for general information purposes only and should not be construed as investment or legal advice. You should separately obtain independent advice when making decisions in these areas.