Finding Stocks that Are Investment Candidates
Finding good investment candidate stocks may seem like an overwhelming task at times. However, you can use a few good metrics to reduce the number to a manageable level. One of the best metrics is the price/sales ratio. This number tells you how the stock market values the sales a company generates. Although it is only valid when comparing companies in the same industry, it's a good start to the evaluation process.
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Investing Goals Often in Conflict
Setting and keeping long-term investing goals is a challenge, especially when it may be almost impossible to define what will be needed for your retirement or funding your children's college education. It is a fact that these two big investing goals will compete for your resources. Although it is difficult, you still need to focus on each goal and determine the best way to allocate your investment dollars.
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Stock Investors Use Margin to Boost Returns, But Watch Out
Using margin to multiply your investment with borrowed money is a common strategy with investors in the stock market. When it works the way you planned, it can put extra money in your pocket. However, if your investment takes a nose dive, watch out because margin will multiply your losses also. Learn more.
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Stock Investors Get Help from Insiders
It is helpful when analyzing a stock for investment to know what key executives of the company are doing. Are they buying or selling shares and why. This information is readily available and completely legal.
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Investors Should Cheer Stock Buybacks
When a company (like Apple) is sitting on a pile of cash, it can increase shareholder value by buying back some of its outstanding stock. By reducing the number of outstanding shares, the remaining shares on the market will be worth more. However, there may be less generous reasons, so beware.
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Use Beta as One Test of Stock's Risk
A stock's beta tells you how volatile it is compared to the overall market. This is helpful in the short term since it gives you a clue how the stock will move when the market moves. While not perfect, the beta is one piece of the puzzle you must consider when evaluating a stock for investment.
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Investors in Stock Market Worry About Interest Rates
Interest rates and stock prices have several connections. Investors should keep an eye on rates, since changes can have a positive of negative impact on stock prices and stock valuations.
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Bond Ratings Guide Investors on Risk
Yes, you should have bonds in your portfolio, but not all bonds are created equal. Some are rock-solid, but offer low returns, while others are much more risky, but pay higher returns. Which is best for you? You can use bond ratings to determine the level of risk you want.
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Market Timing Appeals to Greed, Not Smart Investing
Many investors fall into the "greed trap" when they try to time the market. Maybe they got a hot tip from someone at work or just have "feeling" that a stock is going to move. Either way, they are gambling and that is not a smart road to investment success.
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All About Earnings Season
Following every quarter, companies must report their financials to investors and the public. Much is made of earnings season and the real star is the actual earnings number. Did it rise from last quarter? If no, why not and who is to blame?
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