How are you all? Today I will discuss with you about How to earn good rewards using short-term and medium-term trading? .I will try to present my experience.  I am young and have very little experience so please excuse any mistakes.
First, if we invest our entire money in a single company while trading, then the risk is a bit higher. Because if our predictions are wrong, we can face huge losses. So to diversify the risk, it is very important to invest in multiple companies rather than just one company. If we invest in shares of different companies, there is a possibility that all our transactions will not go wrong.
Now, does investing in multiple companies mean investing in 50 different companies? The answer is no! We should not over-diversify our investments. So how many companies should we invest in?
Investing in the stock market by investing in shares of multiple companies together is known as a portfolio. How many company shares should be in a portfolio? The answer is a maximum of 10 company shares. Second, how to carry this investment? For this you need to follow three important steps:


[Source](https://pixabay.com/photos/chart-trading-courses-forex-1905225/)



Step 1:

Before investing, you need to understand the market valuation, which can be found using tools like Nifty PE or Warren Buffett indicator. Market value is assessed using many metrics and multiples, such as price-to-earnings, price-to-sales, and return-on-equity. So if the market valuation is high, you should invest less while trading. On the other hand, if the market valuation is low, then you should invest more in the shares you are trading.Step 2:
Before investing you need to check the market direction which can be seen using Nifty index.
Nifty is the abbreviation of National Stock Exchange of India Stock Market Index for the Indian equity market.
So if the market direction i.e. Nifty index direction is positive then only those stocks which are in uptrend should be traded. And if the direction is negative, then until you achieve stable returns in the cash market; You should not trade in the stock market.


[Source](https://pixabay.com/photos/trading-analysis-forex-chart-643723/)


Understand, if you patiently want to return by taking a bearish trade when the market is undervalued, that is only possible by trading futures and options; Which means in derivatives market where risk is high.
Unless you are making huge profits in the cash market, you should not step into the derivatives market. This means if the market direction is negative before trading, you should be patient and avoid trading until there is a positive signal.

Step 3:

How to make this investment? The formula for this is simple; One trade a week. This means every week you should first check the market valuation if it is high, then you should check the market direction if it is positive and then invest only in those shares whose trend shows a positive signal.
While investing, invest following a stop-loss and target. We have a separate article; Explaining the concept of stop-loss and target. Thus, if you follow the step-by-step process while trading, you will earn better returns.
While trading in share market, one rule should always be followed, we should trade only when we see a positive opportunity and then try to grab it.Today's discussion ends here.  I hope you find it interesting and able to understand.  Share your thoughts on today's topic.  Wishes and blessings to all.  Everyone stay well stay healthy stay with Steemit