Making investments in the stock markets can be risky, but for most experienced traders, the stock market can be a bread-winner. Both long-term stocks and the best short-term stock investments can give you heavy returns. However, it is common knowledge that long-term growth stocks can be significantly higher in the reward area, but this requires patience. A number of investors don’t have patience and depending on goals of investors, plus disposable income, short-term stocks are tempting to trade in. As long as investors remain focused on their objectives and work towards meeting them wisely, short-term stocks may be a good investment avenue.
It is common knowledge in the arena of investment that buying and selling stocks requires a degree of research and analysis. “Playing” the stock market is not an easy game, but if you stick to some key strategies and a well-defined plan, there are ways to win in the share markets. When investors seek quick profits, either to fulfill certain financial goals for the short run, or for an emergency fund, they do so with short-term stocks. These are stocks that are transacted with on a frequent and regular basis. Although long-term stocks yield more rewards as they tide over market volatility, the best share to buy for short-term purposes could be gainful for you and your short-term needs.
Senior players in the stock market will almost always place their bets for good returns on companies whose stocks are projected as long-haul winners. These stocks can be bought over a lengthy time frame, buying when there are dips in prices and accumulating more till they become eventual rewarding stocks. The same experienced traders will also acknowledge the fact that the best short-term stocks have a vital place in investment for some kinds of investors. Every prominent trading portal, such as the MO trading platform, for instance, will have top picks of the short-term stocks that hold the promise of rapid returns. Short-term stocks are typically the ones you buy today with the goal to sell them within a 3-12 month period. These are valuable in that they give your financial portfolio a decent near-term kick. They earn you solid returns in rapid time. Moreover, they give your long-term holdings a boost by complimenting them. Short-term stocks can give you good returns that you may use to re-invest in long-term, higher yielding stocks.
Short-term stocks are never held by investors for a prolonged time frame. The yields that short-term stocks give are categorized as short-term capital gains and are taxed accordingly. Those investors who deal in stocks for the short run are typically known as day traders. There are diverse instruments that can be great at yielding returns in the short run, and these are linked to the markets as well as a representative of debt instruments.
Which kinds of investors should consider short-term stocks, and which is the best share to invest for the short term? All this depends on the type of investor you are and your short-term time horizon for investment. After you decide to invest in short-term stocks, how to invest in short-term stocks may be on your mind. This is not hard to do. The MO trading platform can help you with top picks, but selecting the best short-term stocks depends on your own goals as an investor. Do you want to slip in and out of the market with a quick profit? Is your goal to make money for the short haul as you have some temporary expenses on the horizon? If your answer to these questions is ‘yes’, you may think of short-term stocks that give you quick returns, but are risky too. Nevertheless, if you do your research, you can make a fair assessment of short-term stocks that are sure to benefit you. Once you see a profit, this can be re-invested in the markets to grow your wealth if you wish to continue your trading in this way.
When you think of your individualistic investment goals, you may want to delve a bit deeper into thinking about what kinds of equity shares you would be interested in to meet your goals. Equity is the financial instrument that holds the most amount of risk while you invest. Shares that are held for the short term can be subject to market volatility and see you in losses. However, if you tread with care and careful calculation, you may just see your just rewards.
Like investing in stocks for the long term, short-term stocks come in three types: large-cap stocks, medium or mid-cap stocks and small-cap stocks. Large-cap stocks are usually those issued by huge companies with a historical record of success over long periods. Hence, these can be good investments for the long term. For the short term, it is prudent to view mid-caps and small-caps, giving not as much returns as large-caps, but giving you returns in the short term.
You may be surprised to find that some stocks that you can hold on to for the long term, can give you significant short-term returns as well. It just depends on how long you want to hold on to them for. For example, buying Infosys stock will give you high returns if you hold the stock for 6 months to a year, but if you latch on to it for more time, you are sure to see higher profits. Here are the best stocks for the short-term in 2022:
Realty Companies - Oberoi Realty, Sunteck Realty, Prestige Estates
Banking - ICICI Bank, Axis Bank, SBI Bank
Technology - Tech Mahindra, Tata Consultancy Services
While you may expect your short-term goals to be met with yields from short-term stock investments, you should be aware of the fact they carry a high risk as they get affected by market fluctuations. They are mainly issued through primary and secondary markets and you need to have a knack to earn huge rewards from them. You should, by all accounts, have a high tolerance for risk, and be prepared for some losses. While you invest in short-term stocks, you may want to also invest in debt instruments like commercial papers, treasury bills, etc, to hedge your risk and meet your short-term objectives.
The MO trading platform of Motilal Oswal can help you choose the best stocks to invest in for gaining short-term profits. It is best to follow the advice of experts while investing and Motilal Oswal has more than enough experience to advise you profitably.
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