A Promise Of High Returns Could Backfire: Avoid These 10 Investment Errors

Investing in the stock market is considered by many to be a great way to grow wealth over time, but it is important to understand the risks involved and have a well-thought-out strategy before getting started.

Sometimes, new investors fall into the trap of deceptive marketing practices promising high or assured returns. Remember, investing in the stock market comes with risk and no one can guarantee that you will make money.

Investors are advised through awareness campaigns by the Stock Exchange, SEBI and other regulated brokers of the market from time to time.

Here are some tips for investors as suggested by the National Stock Exchange Awareness Communication;

• BEWARE OF ASSURED/FIXED RETURN SCHEMES: The broker or their authorized persons or their associates are not authorized to offer fixed/guaranteed/regular returns/capital protection on your investment or enter into any loan agreement with you to pay interest Not authorized to enter. money provided by you. Note that in case of default by your broker for funds or securities given to the broker under any arrangement/agreement, notional returns will not be accepted by the Exchange.
• Do not rely on written and oral promises of assured returns in equity and derivative markets.
• Have complete knowledge about the product you invest in.
• Do not invest in any scheme run by any entity without SEBI registration.
• Do not make any payment in cash to the stock broker.
• Make sure that you have filled the KYC form with correct details and cross off the blank fields.
• To receive trade confirmation alerts directly from NSE, register your mobile number and email ID with the stockbroker.
• Make sure that contract notes are received from the broker whenever you trade.
• Do not share your internet trading account password with anyone.
• Get a clear view of the brokerage and other charges levied by the broker.

Before investing in any stock, make sure you do your due diligence and research the company, its financials and its industry. One can obtain information through company filings, financial news outlets and analyst reports.

Don’t let emotions influence your investment decisions. Stick to your investment strategy and avoid taking impulsive decisions based on short-term market fluctuations.

If you are new to investing or have a large amount to invest, consider seeking the advice of a financial advisor or professional to help you create a complete investment plan.

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