You use a screener like http://finviz.com and select the criteria based on the kind of stock and strategy you want to use. Growth stocks focus on growth metrics like current eps compared to last year/quarter, projected 3 or 5 year growth in earnings, same for growth in revenue. ROE percentage etc. Value stocks screened on valuation metrics like PEG, PS, PB while dividend stocks screen on yield, payout ratio and dividend growth. That narrows down the number of stocks to look at and then you run an analysis on the ones screened for those that fit your investment rules. Research the ones that appear to be the best in your screen results.
I have a paddock of stocks that I monitor, but from time to time I scan with Finviz for specific sectors and industries: Price > $10 Average Daily Volume > 300k Option-able and Short-able PE and Forward PE > 0 (profitable)...this by the way is about all the fundamental "research" I do, as it is best not to bias what the chart is saying. Price above 200 SMA Then I look at the weekly charts to find what I'm looking for; structures in the right-hand side of a trading range. Sometimes I scan for something like: Stock Price > $10 Average Daily Volume > 250,000 shares Daily volume increased 33% (varies) from average volume over 10 periods Comparative Relative Strength vs. SPY crosses above 50-period SMA of Comparative Relative Strength vs. SPY (daily and/or weekly basis) Can't do this one with free Finviz. I use Think or Swim. I run the above and look at the few charts that are showing a sign of strength in the right-hand side of a trading range.
knowing the principles behind what stocks to buy means the difference between becoming extremely wealthy or possibly losing everything. Better read this short article to identify 3 stock picking strategies. (How can you decide which Stocks to buy)
Before selecting a stock, an investor should complete fundamental and technical analyse of the company. It matters a lot that how well a company is performing. So before purchasing a stock just see the past performance of stocks and company.
