Out of the many events that influence the Indian stock market, the budget day is by far the most important. As an investor or a trader, it’s a good idea for you to follow the announcements made during the budget presentation closely. And to do that, it is essential to prepare for budget day. If you’re unsure of how to go about this, don’t you worry. We’re here to help you out. Here are some things that you should do the day before and on the day the Union Budget 2021 is presented.
Ensure that you have strong internet connectivity
If there’s one thing that you wouldn’t want to happen during the budget day, it is not being able to connect to the internet. This is especially true if you’re planning on following the budget announcements through a live blog hosted on the internet. Frequent connectivity drops can cause you to miss certain key announcements, thereby putting you at a disadvantage.
That said, it is a good idea to still have a stable internet connection backing you up even if you’re planning to follow the Union Budget 2021 on TV. Try to stay connected to your home Wi-Fi as much as possible. If you’re a mobile internet user, ensure that you have adequate data balance and settle down in a nook with strong network connectivity.
Make sure that your devices are fully charged
After all that you did to ensure strong internet connectivity, you wouldn’t want your devices to suddenly turn off in the middle of the budget presentation now, would you? To prevent this from happening, ensure that you allow your electronic devices, like your smartphone and your laptop, to charge overnight.
And once you’ve charged your devices overnight, take a few minutes the morning of the budget day to make sure that they’re fully charged. Even if you think that your devices have adequate battery charge to get you through the budget session, it is always better to stay on the safer side of things.
Have a notebook and a pen handy
It is quite okay to not know what every single announcement that’s made during the budget presentation actually means. Nevertheless, if you come across a term that you don’t understand, or if you’re not aware of the implications of a certain announcement, make sure that you note them down.
You can then revisit those specific terms or announcements that you’ve made a note of, and you could try and understand them from the various explanations available on the web. Or, you could always visit #BudgetKaMatlab to find out the answers to your questions.
Ensure that you have everything that you need by your side
Considering the fact that last year’s budget speech lasted for around 2 hours and 43 minutes, it’s possible that we can expect the Union Budget 2021 to be also as lengthy as the previous year’s, if not longer. And so, it is necessary to be prepared for a long presentation.
Ensure that you have all the other essentials that you might need by your side like a calculator and a water bottle. This way, you wouldn’t have to take a break in-between, thereby minimizing the chances of missing out on the budget speech announcements.
Maintain adequate funds in your trading account
Check the fund balance in your trading account the day before the budget session starts. If you find it to be low, top it up with some funds to ensure adequate liquidity. The stock market usually tends to move quite a bit during the budget presentation.
And so, if you have adequate funds in your trading account, you can make use of them to enter into some trades to take advantage of the price swings. Changes in the Long-Term Capital Gains (LTCG) and Short-Term Capital Gains (STCG) taxation system are two of the announcements that have the potential to cause maximum impact.
The market doesn’t play by the rules on the budget day
Getting into the right frame of mind is something that you should do to adequately prepare for budget day. The stock market can be volatile and its movements unpredictable during the budget day. And so, your trading strategies, technical trading indicators, and other trading techniques might not get you the results that you expect.
Since the market will be driven primarily due to public perception and sentiment on the day of the Union Budget 2021, it is a good idea to just follow the trend to try to take advantage of short-term price swings. Always be cautious and extra careful when getting into trades and ensure that you set an adequate stop-loss.
Seek professional help
If you’re not really sure of what parts of the budget to concentrate on or what the announcements that you should keep an eye out for are, always make it a point to consult a professional.
Professionals in the field of finance, such as chartered accountants and taxation experts, are extremely well-qualified and have the expertise necessary to be able to guide you through the budget process. And so, don’t hesitate to seek the help of a professional when it comes to the budget.
Conclusion
Now that you know how to prepare for budget day, all that you need to do next is to tune into the speech at 11 A.M. sharp on the 1st of February. Since the budget speech usually begins with an introductory statement from the Finance Minister, you might feel the need to skip it. However, it is not a good idea to do so.
The introductory speech gives you a brief highlight of the theme of the budget and an overview of the state of the nation’s economy, which can be very informative and helpful. That said, if you ever happen to miss any of the important announcements made by the Finance Minister on the budget day, you could always visit #BudgetKaMatlab and join us there as we sit to decode #budgetkamatlab!
