How To Pick Winning Stocks?

 How To Pick Winning Stocks?

 

It’s Important to know how to shortlist the good stocks from more than 5,000+ companies. You need to investigate the company, the main motto is to study the company background, financially, Analyse the company & check the fundamental performance. Most importantly You need to know the value of stocks and the main key is to know how to invest & make money in the Indian Stock Market.

You need to focus on increasing your percentage of wins, you need to carefully analyze & keep an eye on the market every day.

Stock Market is a place where you can make huge returns. An Individual invests in Stock Market So that they make Good Returns and Wealth in Long Term.

Let’s Gets Start From Basics Terms:

What Is Stock Market?

The Stock Market is also known as Share Market or Equity Market, Here it is the aggregation of buyers & sellers of the shares, which represent ownership claims on the business. a stock market is a place where buying & selling of shares of companies takes place. The process of the stock market can also be explained as a collection of markets & exchanges where regular activities of selling, buying & insurance of shares publicly. When a trader purchases any shares of a company, it is generally associated with the increase in the company’s worth. So share market is profitable for both investors & as well as for owners.

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How Share Market Works?

the stock market is a platform, where it works like an Auction, where the investors buy shares, bonds & derivatives. In the stock market, the average investors can trade on the stock market directly. Instead, they must hire a broker-dealer who will help the investors to execute the trade. Many investors buy stocks through mutual funds, & these are the companies that buy the collection of stocks. So here, the investors buy shares in mutual funds instead of owning the stocks themselves, this will reduce the risk.

What Are The Types Of Stocks?

There are 2 different types of stock
1. Common stock
2. Preferred stocks

1.Common Stock: The Type Of Stock Which Most Of The People Prefer To Purchase. It Represents The Ownership Of The Company And A Claim On Part Of Profit. Here Investors Gets One Vote Per Stock.

2. Preferred stock: They do not have the voting right, but here the investors are usually guaranteed a fixed dividend. if the company is liquidated they are paid off first.

Decide Which Stock Is Right For You

The First thing you need to do is to think about, is if you are comfortable in taking risks associated while picking the stocks. If you find them to be risky, it’s better to buy fewer lots which will reduce the fear of losing a big amount.

Understand The Indian Stock Market

So basically, The stock prices drive stock prices like a war, which it means is unpredictable. Take your time, study the market. So An investor must keep an eye and watch the market, in order to generate income in Stock Market.

Experimentation With Companies In Stock Market

In  Stock Market, you will have hundreds of options while buying the stocks. So you need to keep a record of the few shortlisted companies that you are planning to invest in. You need to keep a list of companies' fundamentals and analyze it. So that you can finalize the top companies that you would like to invest in. This process is also known as an investment plan.

All you need to do is some research and use some strategy.

Understand Share Price And Valuation

So, here let me give you an example.

Company X- Selling at Rs 10 per share; and

Company Y-selling  at Rs 50 per share

Have a look at the stock prices, then you will be buying 2500 shares of Company X and 500 shares of company Y

which do you think is offering higher value for your money?

Most of the investors think, As the price of Company X is low, there is huge opportunities to make money, in order to grow and if the stocks turn multi then having a lot of shares can multiply the profit.

So, here the main thing you need to know before you invest in any stock that it is very important to assess the value of the stocks based on the performance of the company.

You need to remember that the market price of the stock is an indicator of the demand and supply which may change due to other external conditions of the company.

So before investing it’s important to analyze consideration of the fact that you need to consider major factors connected internally and assess their value.

Keep A Track About Monitoring Your Investment Regularly

Keep your eye on the monitoring pattern of your stocks regularly.

This will help you to understand the Indian stock market, trading patterns which will help you to trade better and expect more returns in your future trades.

Fundamental & Technical Analysis

Fundamental and technical analysis are important aspects of the stock market. Fundamental analysis is always a  good choice for long term investors and technical analysis for intraday trading in the stock market.

The technical analysis can be useful for long term analysis as well. if you need to be successful in the Indian market, Investors can use both fundamental and technical analyses for investing in the stock market.

Finding Winning Stocks To Invest

To find winning stocks you must know the basics of the stock market and the performance of both qualitative and quantitative analysis of companies. So by doing so you will be able to find strong companies. The first thing that you must do is to list a few good companies and check their quality by fundamental analysis. By doing so you will be able to know what to buy, when to buy and when to sell. This will help you bid on good profitable stocks.