Stock Market For Dummies
Although I have told all the parts of picking stocks to invest in earlier stock market basics posts, I haven't really combined all together. So if you do know all the stock market for dummies rules given in earlier stock market game posts, then I'll go ahead and reveal that step by step process.
Picking growth stocks to invest in is simple however you must take the time to fulfill all the important steps of this stock market basics rule. You can't just invest in the first stock you see that may look good. It's just like shopping. You compare stocks with others to find the best outcome and the best value. Value is an important part of investing as I've told you all in previous stock market for dummies posts.
So here are the steps to picking out good growth stocks so you can start playing the stock market game.
1) Economic Environment. Before you even come close to the stock market, you first need to determine what economic environment you are in. In an early stock market for dummies post, I revealed a rule stating that economy effects how the stock market will work. That's because the stock market is all made up of companies, companies that will rise and fall because of how the economy works. Some companies will work best in extreme bull markets, others will do better in bear markets. Determine where we are in the economy as it's the first and most important part to success in this stock market basics guide.
2) Business Cycle. The second step in picking out stocks is to determine which stocks are hot right now. The stock market game is simple as long as you follow the right rules. And I told you how important this stock market for dummies rule is. So by following the information gained in the previous stock market basics step, you pick out the stocks that are located in the hot sectors by using the business cycle. If we are in an expansion, cyclical stocks will work. If we are in a recession, stick with more non-cyclicals. Simple.
3) Finding Stocks To Invest In. The two best places I find growth stocks can be found in two lists: the analyst's upgrades list and the 52 week low list. I've talked about both in previous stock market for dummies posts. Remember that any stocks that is given a strong buy or an overweight by analysts is a good indication that it is going to be a hot stock because analysts like to stay as close to neutral as possible. And with the 52 week low list, look for damaged stocks, not damaged companies. That can be done by following the next stock market basics step. Also, make sure you apply the information gained from the previous two steps (pick out stocks that fit the current state of the business cycle).
4) DO YOUR HOMEWORK! The very first rule that I've ever wrote in this blog was to always do you stock homework. And that will never change as long as the stock market game still stands. Doing your homework is how you'll find the best value and the best potential. Research everything you can about every stock you are considering including fundamentals, company news, and conference calls. This stock market for dummies rule is extremely important.
5) Purchasing The Right Stock. By doing your homework on multiple stocks (I would recommend at least 5 stocks), you can determine the best stocks to earn great profits. That's why we play the stock market game, to gain the most profits possible. The most important factor here is picking the stock with the most growth because that's how you'll earn the money. But also keep in mind of value. So return back to an old stock market for dummies concept, PEG ratio. Calculating PEG will help you determine the best stock to own to get the best profits possible in the stock market game.
Learn how to play the stock market game today.
Picking growth stocks to invest in is simple however you must take the time to fulfill all the important steps of this stock market basics rule. You can't just invest in the first stock you see that may look good. It's just like shopping. You compare stocks with others to find the best outcome and the best value. Value is an important part of investing as I've told you all in previous stock market for dummies posts.
So here are the steps to picking out good growth stocks so you can start playing the stock market game.
1) Economic Environment. Before you even come close to the stock market, you first need to determine what economic environment you are in. In an early stock market for dummies post, I revealed a rule stating that economy effects how the stock market will work. That's because the stock market is all made up of companies, companies that will rise and fall because of how the economy works. Some companies will work best in extreme bull markets, others will do better in bear markets. Determine where we are in the economy as it's the first and most important part to success in this stock market basics guide.
2) Business Cycle. The second step in picking out stocks is to determine which stocks are hot right now. The stock market game is simple as long as you follow the right rules. And I told you how important this stock market for dummies rule is. So by following the information gained in the previous stock market basics step, you pick out the stocks that are located in the hot sectors by using the business cycle. If we are in an expansion, cyclical stocks will work. If we are in a recession, stick with more non-cyclicals. Simple.
3) Finding Stocks To Invest In. The two best places I find growth stocks can be found in two lists: the analyst's upgrades list and the 52 week low list. I've talked about both in previous stock market for dummies posts. Remember that any stocks that is given a strong buy or an overweight by analysts is a good indication that it is going to be a hot stock because analysts like to stay as close to neutral as possible. And with the 52 week low list, look for damaged stocks, not damaged companies. That can be done by following the next stock market basics step. Also, make sure you apply the information gained from the previous two steps (pick out stocks that fit the current state of the business cycle).
4) DO YOUR HOMEWORK! The very first rule that I've ever wrote in this blog was to always do you stock homework. And that will never change as long as the stock market game still stands. Doing your homework is how you'll find the best value and the best potential. Research everything you can about every stock you are considering including fundamentals, company news, and conference calls. This stock market for dummies rule is extremely important.
5) Purchasing The Right Stock. By doing your homework on multiple stocks (I would recommend at least 5 stocks), you can determine the best stocks to earn great profits. That's why we play the stock market game, to gain the most profits possible. The most important factor here is picking the stock with the most growth because that's how you'll earn the money. But also keep in mind of value. So return back to an old stock market for dummies concept, PEG ratio. Calculating PEG will help you determine the best stock to own to get the best profits possible in the stock market game.
If you found this stock market for dummies post helpful and wish to find more information like the rules found in this blog, visit Secrets of Successful Traders. There you can find more stock market basics rules that will make you a better investor.
I can’t teach everybody the stock game as a whole because there is too much to cover. But reading up on sources will get you close to being a solid investor.
Secrets of Successful Traders is a trusted source. But if you need more reassurance before purchasing the e-books on this site, they offer an 8 week 100% money back guarantee.Learn how to play the stock market game today.
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1 comments:
You can try implementing this strategy at WallStreetSurvivor.com which is a free online stock trading game. You get $100,000 in virtual cash and you can buy (or short) real stocks in real time.
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