Our fathers with progressing age have attained maturity and acuity in decision making and they are capable of taking tough decisions, maintaining a rational balance. But, our fathers have also faced exhaustion and stress due to long working hours and experienced age-related health problems, in the effort of providing a better lifestyle to us. As the cost of living is increasing at exponential rates, it is also very important to maintain income avenues post-retirement and utilise their free time and saved capital in a more constructive manner.
Many face difficulty in keeping themselves occupied and also earning income simultaneously in a more relaxed and comfortable routine. Stock trading provides an opportunity to the retired fathers to start their own venture from the comfort of their home. Majority of them avoid risk, while making investment decisions with traditional investment tools which are not in sync with current demands. It may be necessary for them to add equity to their portfolio.
There is now an opportunity for one to gift trading knowledge to their beloved fathers, who have spent their entire life toiling and working hard to fulfil the needs of their families. It will help him retain or increase his financial capability even post-retirement. One can start by enquiring and enrolling his/her father to one of the reputable trading institutes that offers hands-on experience of live markets and the skills to trade individually and with less stress.
Many institutes offer free workshops, psychology trading workshops and simulator-based trading for beginners to learn the basic concepts with no risk.
Trading is a skill-based business activity, which requires time and patience to learn the nuisances of the stock market and it has also proved to offer better returns than traditional saving instruments such as fixed deposits, NSE certificates etc.
Trading provides different avenues depending upon the individual's risk appetite, time availability and knowledge, for example, day trading, swing trading or positional trading. It provides the option to be self-directed and manage one's own capital. Let us understand these concepts in brief:
Day trading
As the name suggests, day trading involves the activity of buying and selling stocks in a single day, or even multiple times throughout the day. This type of trading requires high alertness and a well thought out strategy before going ahead. One should be updated with current market news and events that can affect the stock market on a real-time basis.
Swing trading
Swing trading involves holding a trading position for a week's time and trying to capture 3-5% price movement in stocks. If the profit targets are achieved in a day or two, the person can take profit home. It is advisable to do swing trading in Nifty 50 stocks which give good intra week movements. Here, trading is conducted on short term trends and also the intra week volatility.
Positional trading
In positional trading, the holding period is longer. It can be anywhere from one to three months. Its always advisable to do positional trading in fundamentally sound stocks.
The writer is head of education at FinLearn Academy
