This is a very interesting question. Every investor keeps asking this question.Stock market basics aren’t difficult to understand and the tools for finding great stocks are available to everyone – if one is prepared to invest enough time, work hard, and be disciplined about it.
'Buy cheap and sell dear' is a simple mantra you need to follow suggested by stock tips.Making profits here requires a thorough knowledge of industrial sectors in which you plan to invest and a good sense of timing, which guides you when it's time to sell or buy a stock. To understand stock investing,
Here is a rundown of the rules of thumb value investors use for choosing stocks.
1. Price per share must be equal to or less than 66.66% of intrinsic worth.
2. Pay attention to companies featuring P/E rations at the cheapest 10% of traded equity securities.
3. The PEG should be below one.
4. The stock price must be less than or equal to book value.
5. Equity should be greater than or equal to debt.
6. Current assets must be at least double liabilities
7. Dividend yield must be at least 66.66% of the AAA bond yield over the long term.
8. Growth in earnings must be at minimum 7% per year, compounded over the previous decade.