- How to invest in stock share?
- How to buy shares? How to sell stocks how? Where to buy and sell?
- How to play online stock trading for profit?
- How to play the stock exchange?
- How to analyze the stock how?
In this post I will try cover all the basic questions above, because the above is important information to be known by every stock investor. I will try to explain simple to readers who may be beginner and want to wrestle in the stock world.
Stock, what is it?
Shares = securities proof of ownership of the company.
How to register to be able to play stock?
We as individual investors can not directly buy and sell shares. There is a procedure.
We need a stock brokerage company (sometimes called a securities) that intermediaries us to transact on Indonesia Stock Exchange floor.
As an intermediary. Currently many stock brokers are scattered in Indonesia, please check it online. To note, you should select a trusted stock broker, and have official legality to operate from the government.
The goal is certainly for the funds we are safe when we invest. Usually brokers also provide free services for stock consulting for their clients. Also we will be given free stock trading software so we can transact online freely.
Of course, the securities / brokers will charge a fee every time we make a sale or buy a stock. Fee rates vary widely, usually brokers with red plates (owned by the government) have a rather high tariff because their reputation is already large and reliable.
When is a Share Buy and Sell Transaction on IDX Conducted?
The sale and purchase transactions / shares business in the Exchange shall be conducted on a working day called the Exchange Day, namely:Session 1
Monday - Thursday, 09:00 to 12:00
Friday, 09: 00-11: 30
Session 2:
Monday - Thursday, 13: 30-16: 00
Friday, 14: 00-16: 00
How can I make a profit from a stock investment?
The most common way is to buy stocks at low prices, and sell them when the price is high. Simple. There are also other methods to gain share profits such as, dividend payout, and do SHORT (predict stock prices will fall). However, this method is rather rare in Indonesia. The most common way to earn the most common share play is with this low-selling low-selling method.What is the initial capital of stock play?
Currently many securities / brokers who provide a fairly cheap price so you can start playing stocks. Students can start with Rp 1 Million (register with student card), and General can start with Rp 5 Million. Although not as cheap as mutual fund investment, this is much cheaper than the first time that requires initial capital stock of 10 million.
What is Lot?
Lot is a unit in stock that amounts to 100 sheets. Every wish to buy our shares must buy at least 1 lot (100 pieces). For example if the shares of Mandiri bank - BMRI sold 1000 per sheet, then minimum purchase of independent bank stock if you want to trade is Rp 1000 x 100 = Rp 10,000.How to view stock prices?
Can use trading software, such as nexus chart or you can also check stock prices online on the internet.How to analyze stocks?
This is probably the most important part. Analyzing stocks to earn profits means we have to know when to go in, buying stocks. And when to get out, to sell shares. Means we must know the right timing to buy low and sell high. Most people just listen to rumors, wear feeling, see the news, hear gossip, etc .. That is the way I think it is most dangerous if you are serious about taking stock investments.
The most appropriate way to analyze stocks is to use 2 methods, fundamental analysis, technical analysis, and can also combine the two.
What is fundamental analysis?
Fundamental analysis means we know the condition of the company whose shares we buy. Just like wanting to buy fruit, we must know the quality of the fruit was good or not so as not to be disappointed when eating the fruit. We see the texture of the skin, skin hardness, skin color, fruit scent, etc.In fundamental analysis, we see the condition of the company by reading its financial statements, see the ability of the company to generate profits, its cash flow conditions, the level of corporate liquidity, etc. Or if you want more advanced we can see other important ratios, such as:
- Earning Per Share (EPS)
- Price Earning Ratio (PER)
- Price to Book Value (PBV)
Technical analysis
Just like predicting the rainy season, in December we already know that the rain will be more frequent so we can get ready to carry umbrellas, and rain coats.
In stocks, we can predict the movement of stocks by reading certain patterns that exist. So we can know when is the best time to buy stock (when the price is low) and when to sell stock (when the price is high).
By understanding this candlestick, we can be a smarter investor because we can know the trends that occur in the market; whether the market is in a positive trend, bullish or dull, down (bearish). So we do not make the decision to buy or sell stocks based only on feeling, emotions, news, and gossip.
Some technical indicators that are often used by investors are Simple Moving Average (SMA), MACD, stochastic oscillator, bollinger band, etc. We will discuss this in detail in the next post.
Actually technical analysis is not necessarily meticulous, and complicated. Provided you understand 4 or 5 indicators alone it is enough to generate profits. Because the most difficult in playing the stock is to control the emotions, the ego in making purchases and sales. Not easy to panic, and not easily tempted by gossip. This is where the weakness of individual investors when compared with corporate investors, where they already have a gameplan and strategy before the transaction.
Which is better, fundamental or technical analysis?
This is very relative to the answer. Based on investment style of each investor. Long-term investors usually rely on fundamentals and analyze the company's ability to generate profits. While traders are more inclined to technical analysis because the focus is more short term. There is no right or wrong way. Depending on their experience and strategy.
I personally lean toward technical analysis, to know the timing for entry and exit of the market, and also to use fundamental analysis to eliminate a company with a somewhat dubious financial condition. With technical analysis we can get a good profit also loh, because there are some favorable stock chart patterns.
What is a favorable Stock Chart pattern?
Actually there are some proven patterns to give profit in stock. I will share 1 here, name the pattern "Cup with handle"
This is a pattern that gives us the right time to buy stock (when the price is low), because with this pattern the prediction is that the market is rising, positive (bullish). So that means we want to enter the market when the new price goes up.
In the pattern:
- Stock prices had risen
- Then the price drops about 30%
- Then up again about 30%
- And this pattern lasts about 5-7 weekly
- This shows that the stock is in demand, so that at the beginning there is a response to sell stocks from the market, but then many are buying again because the prospect may be a good stock.
- That's when the right moment for us to enter, not too early, and also not too late when the price has soared. We watch the market first, then move in when the moment fits
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