Investing in the stock market has become more popular as the doors are being opened to small scale investors, largely as a result of trading on the market being accessible online. But still, there are many investors who dabble into the stock market and yet believe in many of the misconceptions surrounding the said market in general. Here are just some of them.

The stock market is reserved for big players.

This misconception is true mostly to those who usually stay away from investing in the stock market. Some people think that you may not be able to gain profits in the stock market unless you are a big player, able to invest millions on stocks at any one time. This is a misconception.

While it may be true in the past that the stock market may be reserved for the big players, this belief may be largely due to the availability of stock market information then. While it may be quite easy for the rich to access stock market information then than for any other ordinary investor, the same may not be true in the present. The Internet has allowed a majority of stock market data to be readily available to everyone. This gives even the small scale investor the means to analyze and make stock trading decisions based on data also used by rich investors and stock brokers.

Stock market trading is closely similar to gambling.

Some think of stock market trading as a means of betting with the hope of striking at a winner and then enjoy the winnings. But trading in the stock market is quite different from being considered as gambling. One may need to know about the basics of stock trading to get the proper insight.

When people buy stocks, they are actually buying a portion of the assets as well as part of the profits in a certain company. A stock share actually represents ownership of a company. It is not merely a ticket bought as a bet and then encashed for winnings later on.

While investing in the stock market may be akin to gambling due partly to the risks that may be involved, they are not the same. Gambling is considered a zero-sum game where money is only being transferred from the loser to the winner. There’s no value being created at any time. Stock market investing, on the other hand, earns by way of gaining value over a certain period of time.

Having the basic stock market knowledge is good enough.

While the stock market basics can get you somewhere when trading in the stock market, it may not be enough for a serious investor to be successful. A better understanding of the market can help investors have a clearer idea of what they are doing. This is one of the keys of being successful at the stock market.