e shtunë, 28 korrik 2007

Stock Pick

by Yulianto
Stock Pick is the key of stock investing. With many stocks out there, we need to know which stock should we buy, and which stock we should sell. If you choose well, then you've reach glory, if you choose the wrong stock then might just say goodbye to your money. So how do you choose? If you want to go somewhere like your home, there's maybe many roads you can choose. Different roads have also different characteristic. You'll most probably choose the road which you like the characteristic. If you like the mountain scenery, you might want to go though the mountains. The same like that example, stock picking is very crucial. It's actually the key for success, and the guide for glory. Just follow and stick with your stock pick guide, and you'll reach your goal. But remember that there's no guarantee that your stock pick strategy will be 100% accurate, because there's a lot of factor which influence a company performance, and many of it is tangible like brand, and employee competence.

Many people use screener as a strategy to pick stock. There are many popular screener, like Graham screener for the value investing method. You can modify the screener to fit your character. If you are risk averse or risk taker, you can change the screener to increase the effectiveness. These software is made by expert which can make life easier.

There are various stock pick strategy, which are:

* Fundamental analysis , buying stock with good financial fundamental. Fundamental analysis is finding the fair value of a company. The calculation is done by using the time of money concept, which is money now is better than money in the future. By knowing how is the cash flow, the in and out of money, you can count for it's fair price. That's the difficult thing to do, because you need to predict how much profit will the company make. * Technical Analysis , buying stock based on previous price data. Technical analysis is done by looking at previous price, and volume data. Technical analyst look at past chart of price and different indicator to make prediction about the future prices. The human emotion is an important aspect here. Their willingness to buy stock at a certain price will determine future price. This analysis assumes that price moves at trend, and history repeats itself. It is believed that this analysis is more art than science. Because of that, there has been plenty of critics to this analysis, due to lack of evidence of it's performance. But it is still a popular method in the world, through its easiness. * Value Investing , buying stock which is undervalued. The concept is actually very simple: find companies trading below their inherent worth. * Growth Investing , buying stock with high growth. * Income Investing , buying stock which give regular deviden. Please remind that it is very crucial for you to choose your own stock pick style, not following other people style. If it's good for them, it might not good for you. So know your characteristic, and the stock pick strategy characteristic.

Yulianto http://www.stockpickguide.com