Are you tired of not making money in the stock market? Do you want to do something that is going to change the way you look at stocks and your portfolio in general? The first thing you need to realize regarding stock trading is that you have to know more about the company and the way they are headed than the next guy, this is how you will have your leg up on the competition. Something that you must consider with every stock is whether you are going to take a long position on it or a short position.
Before I get into the tips I first want to make sure you know what the next best short term stock is. In my opinion the next best short term stock will have a very short window where the price increases an incredible amount. What you must watch out for are penny stocks that are hit and miss because often times these will get boosted by fraudulent traders and beginning traders. Remember if you want to trade stocks effectively you need to get some decent stock trading training.
Advice On Locating The Next Best Short Term Stock
Low Price To Book Ratio – If you want the next best stock then you need to get one with a low price to book ratio. You don’t need to know a lot about price to book, just know that the lower it is the better the stock is as long as the price per share is under $10. Just watch out for stocks that have a high price to book ratio because they can lose all your money very quickly, my suggestion is to only trade stocks that have a ratio lower than 1.
Check 5 Year EPS Growth – If you don’t know what EPS is it is simply “Earnings per share” and the reason why you need to look at this is because it will give you an idea how much the shares will increase year after year. If you are looking at a stock that has a negative 5 year EPS then I would recommend looking somewhere else until they can prove their worth to you. Just remember, most shares will not increase 100% like you will want them to, you will most likely find shares that have increase 10% over the 5 years and that is a good sign of slow and steady growth.
The final thing you need to know is that there are many great stocks out there, you just have to find them. Stock prices go up and down on a daily basis so the stock that is the best one today might not be the best one next week.
Before I get into the tips I first want to make sure you know what the next best short term stock is. In my opinion the next best short term stock will have a very short window where the price increases an incredible amount. What you must watch out for are penny stocks that are hit and miss because often times these will get boosted by fraudulent traders and beginning traders. Remember if you want to trade stocks effectively you need to get some decent stock trading training.
Advice On Locating The Next Best Short Term Stock
Low Price To Book Ratio – If you want the next best stock then you need to get one with a low price to book ratio. You don’t need to know a lot about price to book, just know that the lower it is the better the stock is as long as the price per share is under $10. Just watch out for stocks that have a high price to book ratio because they can lose all your money very quickly, my suggestion is to only trade stocks that have a ratio lower than 1.
Check 5 Year EPS Growth – If you don’t know what EPS is it is simply “Earnings per share” and the reason why you need to look at this is because it will give you an idea how much the shares will increase year after year. If you are looking at a stock that has a negative 5 year EPS then I would recommend looking somewhere else until they can prove their worth to you. Just remember, most shares will not increase 100% like you will want them to, you will most likely find shares that have increase 10% over the 5 years and that is a good sign of slow and steady growth.
The final thing you need to know is that there are many great stocks out there, you just have to find them. Stock prices go up and down on a daily basis so the stock that is the best one today might not be the best one next week.
We’re going to break down stock trading training for beginners so it doesn’t seem scary. One of the first things you need to do when you start out is to pick a good broker. A stock broker is going to be where you do all your business. Picking one that has large commissions and fees can be detrimental to a beginner.
ReplyDeleteAn important second step is going to be learning how to read a stock chart. The stock chart holds all of the clues to which direction the stock is going to move. Watch our ThinkOrSwim video on charts setup.
Another great resource for learning to read a chart is stockcharts.com. They have a chart school for any questions that you might have. Charts can look like Greek when you’re starting out. The more you look at a chart, the more you’ll understand it and be able to predict trends.