Gagandeep Singh, a 24-year-old engineering graduate in Khanna in Ludhiana, Punjab, is a happy man. His investments in stocks such as Dishman Pharma and Caplin Point Labs recently yielded good returns. Though Mr. Singh is unemployed, the successful bets are helping him earn his livelihood. This turnaround in fortune was largely due to a young company — TrakInvest — which has improved the skills of many retail investors like him through technology.
Three years ago, Mr. Singh lost ₹3 lakh in just one year in the stock market due to lack of knowledge. “I was disheartened and had decided to quit trading,” said Mr. Singh who later used the services of TrakInvest, an educational platform for virtual stock trading. The company crowdsources financial wisdom to help retail investors make smarter decisions. It uses analytics to mine hidden insights, patterns and unknown correlations from large chunks of data.
“If I am interested in particular stocks, I can now test them virtually before investing,” said Mr. Singh who uses a mobile app and the website of TrakInvest to make investment decisions. A ‘stock chatbot’ which is designed to simulate conversations or ‘chatter’ of a human being, helps users like him to monitor his investment portfolio. It follows market dynamics and answers questions, such as who the top gainers in the stock market are.
Founded in 2013 by Bobby Bhatia, a former top executive at American International Group and JP Morgan Partners, TrakInvest provides users access to 10 international stock exchanges. They also get virtual money to build a stock portfolio. Mr. Bhatia said the firm was educating new investors in a zero-risk environment where everything including the stock prices of more than 15,000 stocks is real, except the money, which is virtual. “I have seen so many investors lose money and then stay intimidated with this asset class forever,” said Mr. Bhatia.
India has a population of more than 1.2 billion, but only 2% Indians invest in the equity market. TrakInvest is trying to change this by allowing a user to learn to invest in stocks in a social manner which includes acquiring skills from peers. “We are now seeing a lot of talent coming out to invest in the stock market,” said Arjun Chakraborti, chief executive TrakInvest, India, in an interview. He said that about 100,000 users have joined the TrakInvest platform and three-fourths of them are based in India. The firm has also tied up with the Indian Institute of Science (IISc) to set up a centre that would provide training in equity stock markets.
Analyst recommendations
Similarly, to help people make smarter investment decisions, another start-up MilkorWater uses data analytics and recommendations from professional analysts. It ranks these analysts based on the performance of their stock recommendations. The firm has also built systems that can analyse a large amount of data and provide insights to retail investors.
“We are targeting about 18 million active demat account holders in the country,” said Amardeep Lakhtakia, a serial entrepreneur who founded MilkorWater with Dinesh Somani. Mr. Lakhtakia smelt a business opportunity when he examined his father’s returns. He realised that most of the investments were in the poorest-performing mutual funds and stocks. The company now analyses stock recommendations of more than 1,800 analysts from 150 brokerage firms for over 900 stocks traded on the NSE.
