After reading this post, you will learn the tricks to choosing the best stocks to invest in.
1. Company Fundamentals
Earnings Per Share (EPS)
Price to Earnings Ratio (PE)
Price to Book Ratio (PBV)
Debt to Equity Ratio (D/E)
Price to Sales Ratio (P/S)
2. Promoter Holding
Warning signs include companies with a large promoter commitment or a small promoter holding. Pledged shares may only be released if the Company is able to sustain positive cash flow.
3. Economic Moat
The capacity of a company to sustain a competitive edge is referred to as an “economic moat,” and Warren Buffett is recognized for popularizing the phrase.
4. Company Management
It is of the utmost importance to do thorough research into the management of the business in which you want to make an investment in the stock market.
5. Invest in a Company You Understand
Investors sometimes lose money on their stock picks because they either don’t perform enough research on the business or buy it blindly due to excitement and Fear of Missing out (FOMO).
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