Stock trading is hard work.
I don’t care what other stock’s traders are saying, I consider it to be hard.
Especially if you’re a penny stock’s trader which is even riskier than the blue chips.
But we all are in it for one and only reason, we’re doing it to make profits. Unfortunately making profits from trading is easier said than done. Some of you are having difficult times spotting the best stocks to trade although you’re doing everything you know.
The reason may be due to your trading strategies. What techniques do you use to pick the right stock to trade?
From this post I’m going to share with you a proven technique that will surely help you make some profits given that you interpret your findings the right way.
How To Look For Stocks To Trade That Will Actually Make You Profits
Looking for stocks to trade is one thing, looking for stocks to trade and make profits from them is another. The latter is the one that we all are going after.
There are some mistakes that many penny stock’s traders or investors are making, those mistakes are often found to be the culprits to their losses.
Are you making them too?
Here are some of them:
- Buying stocks at their very low price.
- Buying stocks from newsletter.
- Buying stocks without doing a concrete research.
- Buying sub-penny stocks
These are four terrible mistakes that may be hurting your portfolio. Before you’re able to make some very nice profits you’ve got to evaluate what you’re doing wrong. The method I’m about to share with you cannot guaranty you that you’ll make profits 100% because there’s no such thing.
But it could be very helpful to you if you integrate it into your day trading’s routine because it can can only make you better at it.
First thing to do: Stop trading stocks that are losing in price. Penny stocks’ investors have the habit of buying shares when the price is very low. In contrary you should be looking for stocks that are already moving up in trend.
Stock’s investors tend to forget the importance of value when it comes to buying shares. American consumers are great at recognizing a sale on their favorite products, but when it comes to stocks we aren’t always as value minded.
Yahoo! Finance has some very helpful lists on the right side of the scrollbar. From this list you’ll need to look for the one that has the top gainers for that day. Those gainers are usually still making profits, buying them the following day after such a wonderful previous day may not be a bad idea.
But you should not buy them without some further investigations. That’s one of the mistakes that I stated a moment ago in this post. You’ll always have to dig through as much information as you can in order to be sure that a stock deserve your investment.
Yes, I say “Investment.” There are a lot of people who believe that we’re not investing when we trade stocks. Some of them even go further to call it gambling. They’re totally wrong and it’s very easy to see that. Why do people invest? It’s to make profits. Why do we trade stocks? It’s for the exact same thing.
I don’t see any reason why someone would say that stock trading is not investing. To get back to our point, your investment is important because you’ve worked very hard to earn your money. You owe yourself that at least to research before you invest that hard earned money.
How to find some information about those top gainers. That’s where your real research starts because it’s from those information you’ll know whether or not you should invest your money. And that’s also how you’ll find the best stocks to trade.
If you click on the tiker symbol it will show you a chart for the stock on which you’ve clicked, but there are some better looking charts than that from other websites. The one that I usually utilize is StockCharts.com. It’s a very nice website for your research, it has more than just stock charts.
StockCharts.com is very easy to use, in fact if you check it you would say the same thing. All you’ll have to do is type the tiker in the box then hit enter to see your graph. It’ll be up to you if you want to change the settings, which could be done bellow the graph.
From the stock’s chart you’ll see the patterns. One specific thing I like to look for is how well or bad that this stock has been doing. It’s kind of help me with my decision. Also the signals should be your friends but don’t over use them. Use just a couple of them so that the chart doesn’t look too condensed.
Secondly: Buying stocks from newsletter is not the right way to go. Instead, try to look for your stocks through a stock screener. Stock screeners are so helpful because you can tell it which stocks you would like to trade depend on your strategies, depend on your portfolio’s strength, and so on…
Stock screeners also help traders to find stocks to trade. Imagine if you were to type a tiker symbol into your brokerage platform every day in order to trade, or if you had to trade only a few stocks that you know. It would not be something that you’ll enjoy to do because it would be too hard and your money would be more at risk.
I’ve heard about so many traders who referring to stock screeners as being difficult to utilize. In reality it’s not difficult at all because you only have to plug in your preferences and get your stocks list. From that list you’ll be able to narrow down to a smaller list until you reach the stock you want to trade.
Nowadays, almost every stock’s brokerage platform comes with a stock screener. You won’t have to spend a dime to use this software. If your brokerage doesn’t make it available to its customers you can find many stock screeners that are totally free all over the webs.
If you have tried a stock screeners before and thought it was difficult it may be because you did not know what you should be looking for from your stocks. I’m pretty sure after you finish reading this blog post you’ll be able to see a stock screener in a different way.
Well, what are essential for you to look for in a stock in order to make it a good candidate?
This question is crucial to have an answer to, or else a stock screener would not mean anything to your day-trading. There are so many categories in a stock screener that you’d have to familiarize yourself with in order to really know what you’re doing.
Ben Brinneman from Stockpickr could not have said it any better in his short post. Check it out here and see what you’ll have to look for in a stock in order to consider it as a good stock to trade.
Lastly, you’ll need to look for stocks that have low debt levels. Doing day-trading does not automatically mean you don’t need to do the dirty work.
You’ll need to find their financial statements and dig into them to see how they’ve been doing. Remember you’re looking for the best stocks to trade, not any kind of stock. It will always require you to do your due diligent in order to spot your match.
A stock with a lot of debts will more likely be unable to make profit. It’s common sense, as they’re selling their products they’re also trying to pay their debts which left them with nothing. For you to be an investor in a company as such would not bring you anything as well. After all, you’re an owner of a tiny portion of any stock you invest in.
So do yourself this favor and look for those important information before you invest your money into any stock. You don’t want to regret your decision, it happens to so many stock’s investors because they’re not being patient enough.
There’s nothing wrong with spending as much time as possible getting to know a stock before you put your money into it, but sadly there’re countless numbers of things that may go wrong when you’re in a rush to buy a stock
Find the best stocks to trade can be done but you’ll have to do your work in order to realize that. We all would love it if we didn’t have too much to do before we can spot the right stocks to trade and start making lots of profits.
Unfortunately it doesn’t work that way and there’s nothing we can do about it. The best way to find the best stocks to trade is to follow some of these advises if you can, but they may not work the same way they do for me if you’re not being patient through your research.
As always, good luck with your trades!