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Guide: How to Pick Stocks to Invest In
Learning how to pick stocks is a common endeavour among investors. After all, there are roughly 58,200 publically listed companies to choose from. And the majority won’t deliver market-beating returns.
The art of stock picking is applying fundamental or technical analysis to determine whether a stock qualifies as a good investment. And when executed well, it can generate enormous returns for investors, far exceeding what a mutual fund or exchange-traded fund (ETF) can offer.
It’s how Warren Buffett became a billionaire, and Peter Lynch went down as one of the greatest fund managers in the history of Wall Street.
So, let’s explore the critical factors that go into a stock-picking strategy.
Originally Published on The Money Cog
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What are the four main investment strategies?
Like every chess player forms a strategy and game plan, a stock picker needs to do the same.
Numerous investment strategies are commonly deployed, each with its advantages and disadvantages. What’s important to realise is that a strategy is only suitable under specific circumstances. That means investors need to pick the approach that’s most appropriate to achieve their investment goals.
Investment strategies can be placed into one of four primary categories. However, it’s worth noting that some investors like to use a combination to meet their investment objectives.
1. Passive Income
A passive income strategy is also known as income investing. This is where investors seek to generate an additional income stream using the…
