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Picking stocks is a lot like buying a car. When you buy a car, you can’t just go with the first one that’s the right color – you need to know about it. You want to check under the hood, or at least kick the tires. If you don’t know about cars, you bring along your brother or your dad or someone who does. Most importantly, you take your time. If you’re not sure about the mileage or the sound from the exhaust you pass it up and wait for a better deal. It’s no different when you pick stocks. |
Stocks
Picking stocks is about more than knowing the company. It's about knowing what's going on in the world that will affect the company. Now it’s time to decide on your goals and make a buy case. First, write what you want out of your investment. Do you want to build capital over 10 years, or do you want to double your money in a year, but with the risk of losing half of it? If you are the former, then you are a growth investor. Otherwise you are a value investor. You might be somewhere in between, but since this is a first purchase it would be a good exercise to pick stocks according to a strict investment philosophy.