Friday, December 31, 2010

Research Of Stocks Is Imminent

 Jim Cramer "As long as you enjoy investing, you'll be willing to do the homework and stay in the game. That's why I try to make the show so entertaining, because if you aren't interested, you'll either miss the opportunity to make money in the market or not pay enough attention and end up losing your shirt."

Think about your attitude when you were planning to buy a new Cellphone or a Computer or a LCD TV. Most people first research a lot about the various brands of products available in the market. They keenly scrutinize the features, performance level, popularity among others,value for money etc, before finalizing the product for them. This shows that people give a lot of time into research as they want to make the best use of the money they are going to spend

However it is has been largely noticed in case of stock market that most of the investors just do not mind investing their money without enough research done on the stock they are going to deal with. Each stock is said to have a personality of its own . This is largely dependent on many factors. Investing into a stock is just like investing into a business. Stock belongs to a company and its personality is quite dependent on the nature of performance of that particular company. The track record of the company through the Balance Sheet , Profit & Loss Account , Annual Results and Quarterly earnings reports, number of investors , proprietor's holding in the company etc., can broadly give a clear picture of the stock's performance in the past and its future expectations.  

A thorough research about the stock with various technical and fundamental parameters put into use can give a good idea that whether that investment will be a good deal for the investor or not. Merely enthused by some promising article , rumour or recommendation and investing into a stock may give drastic results. Equity investing without research is just like playing a game in a casino which merely is a misuse of money.

Same kind of research based analysis is valid in the case of trading of stocks in short term periods as is needed for long term investing . Some stocks are more likely to give good opportunities of trading in comparison to other stocks. Before taking a plunge into trading a trader must give enough time for research of various stocks which will be best suited for his/her style of trading. Trader needs to exploit the movement of the stocks which give the opportunity to trade and this movement is largely dependent on the personality of the stock. So first target of trader is to find appropriate stocks to trade and then next step will be to trade in them.

No comments:

Post a Comment

Required US Government Disclaimer & CTFC Rule 4.41

Futures trading contains substantial risk and is not suitable for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones financial security or lifestyle. Only consider risk capital that should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results. CTFC RULE 4.41 – HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS SUCH AS LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN. All trades, patterns, charts, systems, etc., discussed in this website or advertisement are for illustrative purposes only and not construed as specific advisory recommendations. All ideas and materials presented herein are for information and educational purposes only. No system or trading methodology has ever been developed that can guarantee profits or prevent losses. The testimonials and examples used herein are exceptional results which do not apply to average people and are not intended to represent or guarantee that anyone will achieve the same or similar results. Trades placed on the reliance of Trend Methods systems are taken at your own risk for your own account. This is not an offer to buy or sell futures interests.