Blogs I follow

• - Last week we saw how a $1 million investment in the original Dividend Champions did over the past nine years. Today, we are going to discuss how a similar ... 13 hours ago • - Save, invest, prosper with My Own Advisor. 2017 Predictions You might already know from reading my site, I enjoy making predictions. I treat them as ent... 1 day ago • - I'm loving this new interview series that focuses on people who are doing extraordinary things with their lives. All of these stories have been incredibl... 1 day ago • - Homeownership is a major personal and financial goal for most young people. It’s also one of the biggest financial challenges. With real estate prices se... 1 day ago • - I have recently become pretty obsessed with online real estate crowdfunding, so when Marcel reached out to me to share a post on the topic with the GYFG ... 1 day ago • - For those who are not yet familiar with our *extensive collection of individual dividend stocks. *The entire collection is currently comprised of *1,412* ... 2 days ago • - This is only a content summary. Please visit our blog to read the full content - http://long-term-investments.blogspot.com 2 weeks ago • - It's time for my May dividend update! For the month of May I was able to earn$366.90 in dividend income. This is a YOY increase of nearly 22% which I'm...
2 weeks ago
• - May is all done, and it proved to be another great month for our household. Our net worth climbed $23,000 to$1,828,000 (another all time record high). Our...
3 weeks ago
• - Its time for me to post dividend income earned from my portfolios: DRIP, DIP, & Roth. I enjoy sharing them as these passive dividend income provides me gre...
3 weeks ago
• - If you had been following along so far, you may have noticed that my latest endeavour was to create a successful internet business from scratch. When I f...
3 weeks ago
• - April is financial literacy month. But I don't think I have anything new to teach you. That's sort of why I've stopped writing, I felt like I was preaching...
2 months ago
• - It has been quite a while since I posted last. So much going on, and just so little time. Lit’s of things have been happening. My daughter has won many bea...
5 months ago
• - Hi everyone, I hope everyone had a great week! I'm ready to spend the weekend relaxing and maybe catching a movie with the wife. As far as an update, I h...
11 months ago
• - It wasn’t all that long ago that retirees could count on decent yields from stable, fixed-income investments. Ten years ago, it was easy to find 5% yield...
11 months ago
• - Stock stalking is a weird hobby. In general I do not "follow" any particular investor's activities. However, there are a couple that I have followed of so...
1 year ago
• - Two Purchases for January 2016 (Amgen and 3M) During the month, I made another purchase of Amgen (AMGN). It seemed to be a good time to buy and it starts ...
1 year ago
• - I find myself in a position to make a deal with the devil that could substantially increase my annual day job salary starting in 2016. More cash means mo...
1 year ago
• - Well, here comes my second sell. This one was a long time coming, and I held on far too long. *On 4/7/15, I sold 34 shares of CAG for \$38.14 per share. Thi...
2 years ago
• - Para fazer intraday, além da análise técnica, podemos e devemos tomar atenção ao calendário económico e de preferência ao minuto, aqui vamos seguir todas a...
2 years ago

Wednesday, January 14, 2015

Picking the right stocks is important

Today I came across this study and it has some data that confirm what the stock market is for informed traders/investors and for most people who doesn't understand the market and run away from them.

Stock picking

The way I look at the market, is obvious that we must choose profitable companies to invest in.

This is not for all investors, but for me it is how it works. I don't want to own a company that doesn't make a profit at the end of the year.

The study I mentioned above analise the Russel 3000 between 1983 and 2006 shows that, in this period:

• 2 out of 5 stocks were unprofitable investments;
• 1 out of 5 stocks lost at least 75% of their value
• 2 out of 3 stocks underperformed the Russell 3000
• 1 out of 4 stocks were responsible for all of the market’s gains
This means we have to look at a portfolio and see if our stocks are profitable, with increasing earnings and with good margins. If we do this, I believe we can profit from the market, and grow our wealth in the future.