If you wish to learn how the Indian stock market works and how you can make money in the share market of India being a NRI, then this is just the right article for you. Here we have discussed a few basic points that can make a significant difference in the returns you could generate from the financial segment of India.
- Start early & Set time defined financial goals: Indians living abroad including PIOs – person of India origin should start investing early in the Indian financial markets, be it debt/bond or equity markets (stock markets). Investors that have no previous knowledge in the stock markets of India, viz BSE or NSE should approach a financial firm that would educate him from the very start. Such a novice investor should try honing his skills on the very basics and fundamentals of Indian markets and ask for free tutorials or some trading courses from his broker regarding mutual funds, shares, government bonds, savings accounts, fixed deposits, etc. The bottom line still remains the same, which any investor who wants to invest in India’s share market should start as earliest as possible, even if he wants to invest a low amount per month.
- If you cant invest huge, Invest small but systematically: It is also advised to amateur investors to invest in financial markets systematically with small investments going towards your portfolio’s every month, if the investor does not hold a great knowledge about the operations and mechanics of the markets. The best option for such investors could be systematic investment plans that are being sold with full swing these days by various mutual fund companies like: Reliance, HDFC, SBI Magnum, UTI, LIC, ICICI Prudential, Kotak Mahindra, PNB – Principal, Tata Mutual Fund. SIP or systematic investment plan ensures that you invest a little amount every month into the stock market, which in turn aims at buying more shares/units when the during the bear market. The whole concept of SIPs are based on rupee cost averaging or dollar cost averaging methoad as it is known in the USA – United States of America & UK – United Kingdom.
- Seek Professional Advise: One should seek professional advice from a financial advisor even though investing directly into mutual funds is quite happening these days. A good knowledgeable investment adviser or financial consultant should be hired from a reputed NRI consulting company who could draft a portfolio for you depending on your investing goals and objectives. A good adviser will always keep in mind your interests and how you attain maximum and highest returns over time. Thus, it is highly recommended to opt for a mutual fund adviser incase investors from abroad want to invest in India, this way they would be able to know all NRI investing rules and their whole investment journey would be fruitful.
- Know Indian Taxation: NRIs, OCIs & PIOs should know all kinds of tax implications that they would have to go through before investing in India. They should hire or consult a tax expert or for that matter a good chartered accountant who is well versed with NRI taxes. One must ask this legal expert to guide through all taxing aspects of India when it comes to NRI Investments. If you intend to invest into real estate, mutual funds, stocks or bonds, the consultant should be able to answer to all your complicated Indian income taxes questions easily and quickly.
- Select a good broker: Do not select a NRI broker mere on his brand, rather go in for a stockbroker that is good with his service. As NRI services available under one financial company is hard to find, thus one should try to find out a firm that could help out with opening up of all kinds of accounts; let it be: NRE or NRO Bank Accounts, Dmat Accout, Online Trading Account, PIS – Portfolio Investment Scheme Account, etc. Besides this the brokerage house should be prompt enough to reply to the queries of the client quickly; thus selecting a good broker is highly recommended. To sum up one should not only look for a reputed brand but should try finding out a company that focuses on fast and prompt NRI services.
- Regularly monitor your investments: Investors should sit down, or incase they are located abroad then they must conduct a chat or telephonic conversation at regular intervals of time regarding their investments with their adviser. They should try and see how their investments are doing, and if something more could be done to generate even more high profits. Having a good relation with an adviser is very important. One can also keep an eye himself on the Indian markets by going to websites like Yahoo finance, Moneycontrol.com, NriInvestIndia.com, etc.
Hope this article tried to enlighten you on some basic concepts of investing, especially who are looking to start with their investments in the Indian financial markets at these current levels.