I'm going to start investing my money in the stock market eventually. I'm currently reading up on what to look for when you buy a stock but what I can't seem to figure out is when you're ready to start researching a stock where do you begin? With all the potential stocks out there to choose from how do you pick a handful to research and potentially buy? I know that some industries are better than others to invest in but I'm not really sure where to begin with picking individual companies.|||The book "The Dhandro Investor" by Mohnish Pabrai has a chapter on how to screen for undervalued stocks, it mentions Joel Blatt's magic formula from Joel's book "The Little Book That Beats The Market" and it mentions reports such as the value line summary, the Portfolio Reports, the Value Investor's Club, the list of stocks that have hit 52 week lows, the Outstanding Investor Digest, and other sources of value investment candidates. Keep in mind that an under valued investment is under valued by the market for a reason, the company is facing some challenges that some investors are pessimistic about so you need to find out why and decide for yourself if the company can meet that challenge and in what time frame.
Go to your public library and check out Mohnish's book, you'll find that section heavily underlined and annotated by other readers.|||Investment is the oil of industry. An ordinary citizen has the chance to tap into the profits of big business by contributing their money toward the capital of the company of their choice. This is done by buying stocks, an investment that gives them the right to vote for the company-s directors, and share in the company profits by way of dividends. Preferred stock gives an investor a fixed or predetermined dividend before payment is made to the holders of common stock which, although it offers less security, can increase more in market value. Below are articles with beginner stock investing information, stock investment advice and help, information about stocks, options, stock options trading and stock market investing.|||For the first venture into the stock market you should probably consider investing in a fund rather than an individual share. A fund will have anything between 25 and 100 different company shares which have been researched and analyzed by the fund manager, who makes the investment decisions for you. A fund will provide much better diversification than buying just one or two shares and the price of entry is generally lower, from around 拢50 per month as a regular savings plan. Buy your funds in ISA and the returns are also sheltered from tax.
Don't invest in the market unless you are happy to leave your money for at least 5 years, as the value will fall as well as rise over time.
Disclaimer:
The answers above are for guidance only and should not be acted upon without you receiving independent financial advice relevant to your circumstances. To find an IFA please go to http://www.unbiased.co.uk
Danny Cox, Certified Financial Planner, Hargreaves Lansdown, www.H-L.co.uk
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment