Investing can be generally one of three styles. Of course there are as many ideas as there are people. The most successful investors become proof that make it easier to trust their style. We don't need to figure out everything ourselves. If you're okay with following a style that works, here are the top three:
- Value investing (company has good financial numbers)
- Growth investing (company is moving up on the charts)
- Income investing (company gives good dividends)
All of these styles can be blended a little bit so that buying a company has a bit of Growth or good financial data. That makes the selection of stocks narrowed to the better choices. For example, there might be forty Value stocks on your short list. The better ones will have some growth or income (dividends) also. That makes them the best choice.
As individual investors (not an institution) we can pick the top 5 companies every quarter (3 months) to add to our portfolio. We don't need to pick 100 stocks just because we need to spread billions of dollars around.
The purpose of investing is to have your money work for you. In a bank, the money is working for the bank and you get the leftovers from that.
Here's an example of how obvious it can be. This is the analysis window for the stock ADC. If you look at the bottom half, it's clear the company is improving in revenue, and the expenses are in line with sales. The upper half has the details. The "Rating by Quarter" was steady and was rising just before the company share-price rose. This move might be over. The example shows it's easy to become very smart analyst when the data is presented in clear format.
Here's another stock that might be good, but you can see the difference in the visual presentation quickly. I wouldn't buy this one (not at this time). This is the stock symbol: AI. The financials (bottom left) were flat and starting to lose money. The Rating fell off and the price fell down. Skip the bad ones and don't give them another thought. Get the best few. The short list helps with that, and the analyst window makes it very quick to spot a good one.
