The basic stocks guideline:
1) check financials ( profit and loss, balance sheet)
2) check the management commitee of the company (are they qualified or experienced of same industry background)?
3) review return on equity >15% means good stable stock
4) floating rate ( the more the shares are held by public the greater the volatility of stock i.. E the buying the selling movement will be more rapid.
5) do not invest in company who is lesser than 10 years old as you do not know what future lies for the company
6) investing in stock is like investing a company. If the company you had blind faith in is making losses year on year you need to consider if the company has chance to recover from the crisis. If no, choose other safe stocks
7) monitor if the company is ambitious and expanding. Not all expansion plans works well in the end. But a good expansion plan which is working will reflect in the quarterly eps.
8) compare the stocks with similar industry ROE.
9) overvalued stock is abit risky unless you have the appetite for it
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