How To Earn Money in the Stock Market – Expert Tips & Guide

Wondering how people make money in the stock market without getting stressed? Here’s a story that explains it all.

• Let’s say Ankit, a 28-year-old software engineer from Pune.
  
  
• In 2014, he invested ₹1,00,000 in a Nifty 50 index fund.
  
  
• He didn’t trade, panic, or follow tips; he just relaxed and let his money grow.
  
  
• By 2024, without doing anything, his investment grew to about ₹2,59,000 — thanks to an average 10% yearly return.
  
  
• That’s more than 2.5 times growth with zero stress! Isn’t that cool?
  
  
• Meanwhile, his friend Rahul kept chasing “hot stocks” and ended up with just ₹1,10,000 after 10 years.
  
  

The lesson? Patience and a smart plan win over rushing and guessing every time!

What Is the Stock Market and How Does It Work?

Let’s say Rohan starts a company selling electric bikes. He needs ₹10,00,000 to expand but doesn’t want a loan. So, he decides to raise money by offering 10,000 shares at ₹100 each through an IPO on the NSE. Investors like Priya buy 100 shares for ₹10,000. Now, Priya owns a small part of Rohan’s company.

Read More – How to Learn Trading – Step-by-Step Guide for Beginners

Soon, demand rises as the business grows, and each share's price increases to ₹150. Priya decides to sell her shares, making ₹15,000 — a ₹5,000 profit. This buying and selling of shares is what happens daily in the stock market.

How the Stock Market Works

• Companies issue shares via IPO to raise money.
• Investors buy shares through brokers.
• Shares are traded on stock exchanges.
• Prices change due to supply and demand.
• SEBI regulates the market for transparency.
  
  

Ways to Earn Money in the Stock Market

The information below is taken from an Economic Times Article

Let’s say Anita, a Mumbai school teacher, decides to invest ₹50,000 in BlueRide Ltd. in January. She buys 500 shares at ₹100 each. Over the next year, Blue Ride’s e-bike rentals boom, and the share price rises to ₹150. Anita sells all her shares for ₹75,000, netting a ₹25,000 profit.

Meanwhile, BlueRide declares a ₹5 dividend per share, so she also earns ₹2,500 without selling any shares.

Key Takeaways

• Capital Gains: Buy at ₹100; sell at ₹150 for a profit of ₹50 per share.
• Dividends: Receive ₹5 per share annually for passive income.
• Short-Term Trading: Watch daily price swings; buy low in the morning, sell high by afternoon.
• Long-Term Investing: Hold promising companies for years to compound growth.

Ways to Earn Money in the Stock Market

By combining these methods wisely, like using dividends for income and capital gains for growth, you can build a smart stock market strategy that suits your financial goals and risk appetite.

How to Start Investing and Earning in the Stock Market?

1. Select a Reputable Trading Platform

Begin by picking a good and SEBI-registered trading platform or broker. A trusted platform facilitates easy and secure purchase and sale of stocks.

2. Create a Demat and Trading Account

For investing in stocks, two accounts are required:

• Demat Account: Stores your shares in electronic form.
• Trading Account: Enables you to purchase and sell shares in the market.

Both accounts must be connected to your bank account for simple fund transfers.

3. Deposit Funds into Your Trading Account

Fund your trading account from your bank account. This is the money you will use to buy stocks.

4. Study and Choose Stocks

Investing first requires research on companies and industries. Analyse financial statements, market patterns, and business success to choose the appropriate stocks for your objectives.

5. Determine How Much to Invest

Determine your investment amount according to your financial objectives and risk appetite. To minimise risk, diversify among various stocks.

6. Order to Buy Stocks

Select from:

• Market Order: Buy at prevailing price.
• Limit Order: Buy when the price hits a predetermined level.

7. Place the Order

Verify and submit your order on the platform. The shares will be credited to your Demat account once they are processed.

8. Track Your Investments

Monitor your portfolio periodically. Keep an eye on the stock prices, company news, and market trends to make decisions—whether to hold, buy more, or sell.

Tips to Maximize Your Earnings in the Stock Market

The information below is taken from an Economic Times article.

For Example, Ravi, an IT worker, put ₹1,00,000 in a Nifty 50 fund in 2005. He didn’t trade or worry about the market. He just waited. By 2025, his money had become ₹9,00,000. He didn’t follow tips or try to time the market. He simply stayed patient and didn’t sell when others got scared. That’s how he won.

This example reveals a simple truth: investing is less about action and more about patience.

Why Patience Wins in Investing:

• Compounding takes time: Long-term holding helps money grow exponentially.
• Market timing is nearly impossible: Even experts can’t consistently predict highs or lows.
• Emotional discipline is key: Sticking through crashes leads to big gains later.
• Fewer transactions = lower costs: Less trading means fewer taxes and brokerage charges.

Buy & Hold vs. Frequent Trading – Which Builds Wealth Better?

Skill Required

Basic knowledge. Focus on quality investments and patience.

High-level skills are needed to analyse, predict, and act fast.

Emotional Discipline

Strong patience is required during market dips to stay invested.

Difficult to manage emotions—fear and greed often lead to poor choices.