So what are some good stock investments for your portfolio? Just about everybody wants to know this. The truth is, the answer all depends on what type of investor you are.
There are really two types of investment strategies you can follow-short or long term. Therefore, the stock you decide on largely depends on your overall strategy for making money with the stock market.
For instance, if you have a long term outlook, good stock investments would be larger companies such as Disney, Microsoft, etc. While these companies many not offer the biggest opportunities for short term growth, they are very stable companies that you can be sure will turn a profit for a long time.
However, if you are short term investor, good stock investments will likely be smaller, more risk companies that have big growth potential. Keep in mind, you never want to invest in the companies long term, as that will likely be financial suicide; however, if you know how to determine trends, short term you can make a killing of these types of companies.
If you are short term oriented investor, you likely will not be very concerned with a companies overall health; instead, you will look at it’s stock price trends, the overall market trends, and try to decipher what you think the stock will do compared to the market. This is huge difference from a long term outlook, because short term investors don’t take into account a companies’ overall financial health, because there is no need to.
Short term, the market mis-values companies based on investing trends. For instance, once people start investing in one company, its’ stock price will start rising. Many people often jump aboard.
This will cause the stock to rise significantly above what the company is really worth. In the other scenario, when many are selling it in masses, the stock price will fall substantially below the fair market value of the company.
The bottom line is, you need to determine which strategy you feel most comfortable and confident with. Good stock investments will be different depending on which strategy you choose to adopt. No matter which way you choose, the important thing is to make a decision, and commit to following it no matter what.
For more info on how to buy stocks, and tips for investing in the stock market, visit http://www.stock-investing-tips.com, a popular site that teaches how to make a fortune from your investments.
By Josh Neumann
Article Source: http://EzineArticles.com/?expert=Josh_Neumann
No comments:
Post a Comment