How to RESEARCH STOCKS?

CHAPTER 12
RESEARCH STOCKS


STEP2
RESEARCH STOCKS
It is very important that you do proper research on the stock because the stock markets behave in weird ways and you should have proper knowledge to it. Never buy the stocks at random, as the market is not random and it works on lots of principles and attributes. If you want to succeed in the stock market you have to do proper research. Either you do the research on your own or you can hire someone to do it for you.
5 VITAL ISSUES
• Fundamentals about the company. How is the company doing, is it a profit making company and a sound company.
• What is the price history of the stocks of that company, i.e. how much are the investors paying for the stocks.
• Price target is also a vital factor; you have to see how much the investors would pay for the stocks in future.
• What catalysts would change the investor’s perception of the stock?
• The most important of all compare the stocks with others in the same industry.
So, to sum up we can say that it’s important that as an investor you should have understanding of wider markets trends, knowledge of individual sectors. Also you should be able to analyze the financial records. You should not be able to have access to rumors and upcoming deals. Last but the most important is No emotional bias, generally this last point is overlooked.

Research before buying the shares; this can be done in many ways,
• Go through the TV SHOWS and the newspapers, they have all the details of the shares which are doing well.
• Try to get the hold of the company’s annual reports whose shares you are planning to buy.
• Take valuable tips from friends and family members who have the knowledge of the subject,
• Never take any decision in HASTE and do not ignore any ADVICE.
• Full service brokers also help to do the research, they hire the stock analysts and they in turn find out which would be the ideal stocks purchase for the client. They charge a specific fee for their services.
• Interviews of the owners, CEO’S, directors etc also are helpful as they normally give the correct synopsis of their company.
• In today’s world the internet technology has made the things easier for the investors to the research on their fingertips, they can research on trading charts and platforms. Some of these charts are available for free and some have costs attached to it.
It is of very important that you get all relevant and correct information on time so as to grow in the market and make maximum profits. You should be aware of that in the stock trading wrong and unreliable information is very dangerous.