When to buy a stock ?

There are so many factors you should consider before buying a stock... In this article I will be telling you 7 Most important factors you should check before buying any stock.

This 7 things will help you for selecting a stock for long term! So let's begin...

1.Business Model

This is a most common thing you should know before investing in a company. You should understand the business model, what the company do and how it makes profits and will this company survive in recession and if yes then why or how?

Ask yourself this kind of questions and if got the right answer's then good to go on second point.

2.Revenue

Revenue of the company must be increasing year after year... You can check this by visiting any Financial website, one which I use is screener.in

See human population is increasing year after year right? And it will of course continue increasing in future so the customers of the company also should increase and if the revenue is not increasing then it is not a good company to invest in !

3.Debt

Debt of the company should be less except banks.

Because if the company has a lot of debt then it will not survive the recession. Debt to equity ratio will help you in here... A low debt to equity ratio is good for you, Ideal debt to equity ratio is 1:1 or lower.

4.P/E Ratio

A price to earning ratio is the most popular ratio in the world.... A low P/E ratio is good! Now you should compare P/E of company which you are about to invest in with the peer's.

5. Management

Company's management plays an vital role in its prosper and its failure . If company's management is corrupted then company will not last in future. So always look for a good management....

6.Court case's

Check for any Court cases on the company, if company has any court cases then it will affect a company a lot.

7.Intrinsic value

Always try buy a stock below it's intrinsic value... See if you buy a Blue chick stock when it's price are inflated then you will not get profit right? So remember this... Always try to buy stock at discounted rate!

Comments

Top 4 Tax saving investments

1. Public provident fund (PPF) . A public provident fund is an tax savings investment in india introduced by national saving institute of ministry of finance. Any Indian citizen can open PPF account The amount you invest upto 1,50,000 is deductible from your taxable income. The interest you earn is non taxable and the maturity amount you get after 15 years is also tax exempt. 2. National pension scheme (NPS) NPS is a government sponsored pension scheme. Any Indian citizen can invest in National pension scheme .You can make an annual contribution till you turn 60 years of age and minimum requirement is 18 years of age .If you invest in national pension scheme (NPS) then you van avail a deduction of 1.5 lakhs under section 80c and also an addition deduction benefit of 50,000 under section 80CCD. 3. Equity linked saving scheme (ELSS). An equity linked saving scheme (ELSS) is a type of diversified equity scheme which is close ended with a lock in period of three year...

The 50 30 20 Rule

Hello reader !! I hope you are doing well..! So what is 50-30-20 Rule ... Well it's a simple Rule which protects you from bankruptcy. In the past people didn't had any Rule for personal Finance so the people who were smart they saved the money for future and the one who weren't they just spends their hard earned money on unnecessary stuff's and ends up broke. In order to stay financial free we should follow this rule Here this 50_30_20 Rule helps you in order to achieve your financially Goal! Lets hop onto it! According to this Rule one's income is divided into three parts in the percentage of 50 ,30 and 20 ....where one should put 20 per cent of its income for savings and investments , 50 per cent for necessary/daily stuffs while 30 per cent for luxurious needs! Of course you can reduce the percentage of luxurious stuffs and add it to savings and investments! It totally depends upon you!

Risks Management in stock market !

Warren buffet has given two rules ... 1.Protect your capital 2.Never forget rule no. 1 Make sense right ? ofcourse it does . So never forget this two rules and you will have a nice career in stock market. Most people say its too risky to Invest or trade in stock market , or they say ‘You will loose all your money’ they are right But , Risks comes from not knowing what you are doing ...So to reduce risk ,learn more ! If you know fundamentals and technicals of a company and you are getting good signal to buy then you must ! Today most people do trading in stock market ! Day trading is quickest way to financial suicide . Swing trading is good and long term investment is better ! If you found a good stock then it is better to keep the stock as long as you can, because compounding is eighth wonder of world ! And you will get dividends too. J ust make one good strategy or adopt one good strategy and follow it . ....

The Source

Search This Blog