Thoughts On… Stock Picking

Stock PickingImage courtesy of [worradmu] /

When it comes to accumulating wealth and getting your personal finance in order, one of the most commonly discussed items are stocks. Having a part in the stock market is exciting but for most of us, we want to have the excitement of seeing positive gains in our stocks without losing any money along the way. That is difficult to obtain and in almost every case, you are going to have both good and bad days and stock choices. What can you do in order to choose stocks that are going to provide you with the positive gains that you desire?

One of the most important things that you need to understand about stock picking is the fact that there is no one particular method that is going to guarantee you unlimited success. If there were such a method, people would be using it to amass untold wealth and they certainly wouldn’t be putting it into any type of report or system that could be purchased and used by anyone. That doesn’t mean that there are not some solid strategies that are available which will help you to choose a stock that is going to be healthy and will give you a better chance of seeing success. Here are a few tips which can help to guide you through that process.

First of all, you need to consider the fact that stock picking is more of a matter of intuition than an actual science. Although there are going to be certain items that can be considered about the health of a company before a stock is chosen, there is always a possibility that a downturn can come out of nowhere. Of course, if you are good at picking stocks and you have the intuition to make a good guess when you are doing your investing, you will find that a considerable amount of wealth is available.

There is also a difference between playing it safe and taking some risk. Of course, any type of stock picking is going to carry risk with it, even if you choose some of the safest stock that is available. There are also opportunities for you to make a considerable amount of money in a very short amount of time. For example, those who purchased Microsoft as an IPO would have seen an increase of over 30,000% in the first 20 years that the stock was live. If you are able to choose an IPO such as that, you can make a lot of money quickly but making poor choices is also certainly a possibility.

One other thing that I would like for you to consider about stock picking is the fact that there is also some science in doing so. This can come in the way of fundamental analysis and technical analysis. Analyzing the direction that stocks are moving can certainly help you to choose wisely on a consistent basis. Understanding that analysis, however, is going to take some time and many people devote a lifetime into learning it. If you are able to grasp those concepts, you can benefit from them.

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From The VestaTrader Blogpost Thoughts On… Stock Picking