Stocks & Shares Tutorial
- 1). Find a company whose stock is worth investigating. Use the MoneyCentral Stock Scouter to find a company worth investing in (see references below). Look to the navigation bar on the left and click on "Top-rated stocks." This will bring you back a list of stocks with solid fundamentals such as earnings per share. Look for stocks that have a rating of eight, nine or ten. These stocks sometimes outperform the overall market.
- 2). Check the fundamentals. Choose a stock by clicking on the ticker symbol on the list. This will bring you to a page with more detailed information on the company. On the right hand side of the page under "Stock Scouter" click on "Read Full Report." This will give you information about the fundamentals of the company and why it has a high rating.
- 3). Check the 200-day moving average. This is a commonly used technical indicator that is used by professional investors to determine the strength of a stock. Only buy stocks that are trading above the 200-day moving average. If it is trading below this line then you should sell the stock if you own it, or stand aside until it is trading above it, if you don't.
- 4). Look at the trend on a chart. Determine the trend by drawing a line across the top of the highs and another one across the lows for the past 3 months. Look at the chart and decide whether the trend is up or down. If it is up then you will want to buy the stock towards the bottom half of the channel. If it is down then you will want to wait to buy until the channel is sloping up.
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