How to invest in stock markets??

If you don’t have time to monitor and evaluate shares, leave it to the experts. Invest in Mutual Funds and don’t try to time the market. Start a Systematic Investment Plan- SIP-which is a way to put small amounts of money into the stock market at regular intervals.
When buying mutual funds, look for assets under management and management fee costs. Both of these are easily available on most websites like moneycontrol.com. Assets under management must be typically high, and management fees must not be very high typically 2-2.5%.
When investing in shares directly, always invest for the long term but monitor closely. If you set a target of 20-30% return from a particular share, don’t hesitate to take your profit if that target is met. Always evaluate shares for expensiveness by looking at a ratio called 'P/E'. Compare it with other companies of the same industry and size. P/E stands for Share Price to Equity Ratio it is nothing but the Share Price divided by the Earnings per Share. For example, a Company makes a profit of 10$ per share and is currently trading at 80$ its P/E is 8.In other words, investors are willing to pay 8 times as much as the company is making for every dollar or rupee.
Now to know whether the company is overpriced or not compare it with a similar company in the same industry. If its peer is trading at 4 or 5 then surely it the company you are looking at is overpriced. But if the peers are trading at 14-15 then u can consider buying the company provided other things are ok. There are so many things to consider while buying shares and P/E is just one of it. Make sure you understand this and I will get you the rest of the factors in my future posts. Keep reading.