Monday, 7 November 2011

The stock market (2)

I have written in my previous article that you can find reliable information about the activity of a company and its shares in financial newspapers.
I have read in a newspaper that the profits of a certain company have increased by 53% for the first 9 months of this year as compared with the same period of time last year. Taking into account that I have invested in this company and I have followed it in its accomplishments, my heart jumped with joy. Till I check the evolution of its shares, whose graph looked not that amazing. Anyway I would recommend this company’s shares as a long term investment. Better say, in such a situation you can invest if your goals are set for the future, not for the near present.
Also if you follow  the evolution of profit for a certain company, analyze the situation, meaning what factors have lead to either the increase or the decrease of it. This will be developed in a future article.
So if you want to invest, do not be shallow  and analyze everything about the company and do not forget that the stock market usually incorporates all the information (sometimes rumors, panic and others). That is why some stocks can be undervalued or overvalued. And the winners are those who buy the undervalued.

No comments:

Post a Comment