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Photos: R.M. Rajarathinam and M. Moorthy

ENTHUSIASTIC New avenue to excel

“Profits and losses are a part of share trading. But what gives me pleasure is the sense of playing with money, all by myself,” she says gleefully.

While she can boast a good six years experience in share trading — the trendiest business among homemakers today — relatively new entrant Savitri Srinivasan calls it a quits. An entire year failed to teach her how things can possibly go wrong in market and she blew Rs. 30,000 in a day.

“My friend and I got into it. Both tried really hard to keep up with the trend but had to quit due to continuous losses,” she rues.

Women must watch out for what the financial analysts call the ‘herd mentality.’ “Everyone follows the same trend not quite knowing where it leads to,” says the Manager of National Stock Exchange, Chennai, Sunitha Anand. At a workshop on ‘share trading for women’ held here recently, she had warnings aplenty to share with women.

“Refrain from taking advices from whoever you come across,” was her first advice to the novice share holders gathered out there. “There is no upside or downside being a women trader. Success will come to you as long as you are smart.” A lot more such nuanced feedbacks followed suit.

“Choose a registered stock broker or a sub-broker. Check for their registration status in NSE websites. Proximity of broker is also important. Negotiate the brokerage and statutory charges well beforehand. In most cases, the statutory charges would have been factored in along with the brokerage.”

Revathi, who was one among the 150 women at the workshop, grudged about the losses she incurred last year. Her stock broker enrolled her into digital format of documenting, of which she had seldom knowledge. With no hardcopy documents to update her about the trend, she lost a whopping Rs. 50,000 in one stroke.

Ms. Ananth has heard scores of unhappy analogies like Revathi’s. For those who fancy to dabble in shares, here is what she has to say about trading. “If you are not familiar with internet, ignore the e-contract page. A much-obvious but much-overlooked advice is reading the documents thoroughly. Since most of the share documents are fat 30-page documents, we tend to skim through it. Read the risk document twice and be convinced that nobody can eliminate market risk. Never leave any boxes in the documents blank. If anything doesn’t apply to you, write it so.”

For those who lament about the legalese language in market risk documents, Ms. Ananth has some good news to share. Stock exchanges will soon issue market risk documents in vernacular languages.

Transactions with the broker must never be made through cash or demand drafts/cheques, only in the name of broker, must be issued.

While financial disclosure wouldn’t be risky, investors must refrain from giving the power of attorney to the brokers.

“That’s like giving a signed blank cheque to someone you don’t know. Power of attorney must be given only to people whom you trust or better still, your life partners.”

Brokers have been scrutinised by stock exchange officials and are under constant guard. “Most of the brokers are compliant but investors should not give them opportunities to mess up with their money and get away easily.”

Despite all the safeguards, she cautioned, investors are not out of woods. Speculators bent on riding new stocks tend to distort real value of them. If you like to play it safe all the time, monitor your account constantly, analyse the trend and research on portfolio of shares you have bought.

Women were in for more expert guidance at the workshop. “It isn’t exactly one of those velvet jobs,” V. Nagappan, Director of Madras Stock Exchange, pointed out. Women religiously took down his beginner’s guidance for stock investments. The multitasking gender is at an advantage than men in share trading. Time management and willingness to learn makes it much easier for women to take this route to earn some quick bucks.

“Women, genetically, are good at managing accounts. Share trading comes easily to them.” Retirement planning must ideally start at 21. In most households, a look at the credit will reveal that the well has run dry. “Take a realistic look at your lifestyle. Analyse whether you can afford to live the way you do. Understand the power of money and power of compounding,” he said scheming out a workable investment plan.

He silenced the never-dying questions on best buys with a matter-of-fact answer: “there is no universal rule in stock market.”

The stocks with fastest opening-day sprints might not do well later in the week or pace up faster than opening.

“You can’t control the future returns of stock market. But you can control your money from flowing into points of no return.”

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