Class-9: When is the right time to enter and exit from the Stock Market?

“Cash is a Bad Investment”

This statement was given by God of Investing – Mr. Warren Buffet, he says it is very important to understand investment properly. Due to many factors like - minimal returns, decreasing the value by inflation, and potential losses in opportunity, keeping cash doesn’t sound to be a wise decision.

There are other investment opportunities available too – Gold, Real Estate, or FD. These can be some good options for diversification, but even they have some issues. Either they give limited returns, having liquidity issues, or need a huge capital, to begin with.

Vinay, A common man with some savings understands it. He decides he will invest in stock markets, not only to get good returns, but to also make contributions to the growth of businesses in the country. But he is faced with a dilemma. When should he start investing?

He sees the market going up and down. Some suggest him to wait, as the market is in an all-time high and buy when stocks are cheaper. Some say the market would rise more and this is the right time to buy stocks. This puts him in a confusing position.

He would face the same dilemma when he decides to sell the stocks.

• How to get over this confusion?
• How to identify the right time to enter and exit?
• How to make most of our investment?
• How to know the right time to buy a stock?
• What is the right time to sell a stock?