Investing For Beginners – Free Investment Articles and Tutorials

India is fast emerging as an important destination for international investors. This is evident from the number of foreign institutional investors who have started investing in India. These investors are being furiously wooed by the Indian government which wants investment India to become a major buzzword in the West.

The Indian government has relaxed its rules for foreign direct investment, popularly known as FDI in the country. There was a time when an international organization could not hold more than 49 per cent equity in Indian companies. Today, there are some sectors where the FDI is 100 per cent.

The Indian stock markets too are attracting huge amounts of foreign funds. They are attracted by the earnings per share because the Indian stock market is still in its early years of growth. The share prices do not reflect the fundamental strength of Indian companies or the strength of Indian economy.

The belief is that Sensex or the Bombay Stock Exchange Index is much lower than international exchanges. Investments made at this time in Indian stocks can deliver huge returns in the coming years.

In the last 12 months (2004-05) the Bombay Stock Exchange Sensex went up by 1500 points, and the growth continues. Stock market experts forecast that the market has the potential to go past the 10,000 mark as against the current 7,700.

The Indian government has set up a regulation body called the Securities and Exchange Board of India (SEBI) to ensure that the stocks markets are not manipulated by speculators. SEBI is also required to protect the interests of small investors.

Besides the Bombay Stock Exchange, which is the main trading centre, India has 22 more stock exchanges located in different cities. The volume of trading is much lower on these exchanges, but they make trading possible in stocks of regional companies.

The Indian economy is expected to boom in the coming years. This will make investments in India even more attractive.

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