Millennials and stock trading in India

The Rise of Online Stock Trading by Youngsters in India

In the 90’s with the advent of computerized stock trading a lot of stock trading terminals were set up all across India. Most of the people investing in shares and stocks belonged to the business class or higher class who had extra money to invest. Having extra money in those days means a middle aged person who has succeeded in his/her career or business. Most of the youngsters were unaware or were not very keen on risking their small earnings in the share market. The trading was time consuming and not as smooth as today. There were paper share certificates and the stock traders need to visit the terminals very often for paper work and other formalities unlike today when everything is online and so convenient.

However in today’s age the millennial are well informed about the stock market. Many youngsters start investing in stock market at the very beginning of their careers. There are others who keep a watch at the stock markets on regular basis, try to understand the trends before investing. The smart millennials with smart phones and laptops have access to latest and updated business news. They study the trends, fundamentals of the company, long, and medium and short term perspective of the stocks before investing. There are professional financial experts, financial planners and stock brokers in the market from where the youngsters get tips to invest in stocks.

Though the trend is very impressive, yet we have a long way to go as far as stock trading in India is concerned. The young generation in the cities may be aware of the stock trading but our rural India is still lacking behind. A large chunk of population still believe that bank fixed deposits are far better and safer than buying stocks, securities, bonds or mutual funds. Stock trading is really a risky game, this is what many people think.

I believe that a long term investment in fundamentally strong companies will always yield a good return. The millennials interested in stock trading need to understand that when you are planning to trade in stocks do not think that this is the route for quick and easy money. When you are in a job it becomes difficult to stay abreast with the latest market trends. Therefore it is advisable to take the help of market experts who have good reputation in the market and the ones who will guide you based on their extensive research.

Many of us must have heard about the successful youngster Jatin Khemani from Delhi. At the age of 21 he bought his first stock and then went on to buy more stocks, some of which generated around 900 percent return in four years. After reading some books like, Peter Lynch’s One up on Wall Street, William Thorndike’s The Outsiders, Philip Fisher’s Common Stocks and Uncommon Profits and Saurabh Mukherjea’s The Unusual Billionaires, Jatin got inclined to stock trading.

There are numerous Jatins who are flourishing in stock markets today with smart trading techniques, inspiring the new generation to invest in stocks.

According to securities and exchange board of India (SEBI), there were around 34 million demat accounts in India in 2018. This is a very small percentage in a country where the total population is over 1.3 billion

The Indian market is huge and there is a lot of potential for the stock markets to grow in the near future. More and more people especially the millennials will come forward to invest in the stock markets in the coming years. The growing income and awareness will definitely lead to a great surge in investments in stocks by the youngsters. Since the fundamentals are strong, FDI will also help the Indian stock markets to grow in the coming years.