Friday, July 30, 2010

Three Steps To Investing For Dummies

Tags

I consistently get emails from my readers asking what is an easy approach to investing for dummies. Most of us are not traders and we can't sit at the computer all day studying the market. "WE" are the night traders. We look at the market each night. We look at our positions after the market has closed. And, we can't study hundreds of stocks a night. We want a simple system of stock investing for dummies like us. But we are not stupid, we're just pressed for time.

Here are three steps I would take if you are looking for an investing online for dummies approach.

Step One: Get a subscription to the electronic edition of the Investor's Business Daily. This will provide you with nearly all of the tools you need to succeed. With the electronic edition, you'll have it most nights by 9 pm ET. In the meantime, you'll have IBD TV Market Wrap and access to the stock checkups and charts on investors.com.

Step Two: Pick one screen in the IBD to focus on and use it for all of your investment ideas and focus on stocks breaking out. You might use the IBD 200. Maybe the Weekly Review. Maybe the Stocks on the Move or even the Stocks in the News. Nearly all of the best stocks in the market pass through these screens. Focus on stocks breaking out on 2% price increase and a volume percentage change over 100 percent.

Step Three: Pick a stock with the strong ratings. Look for Smart Select Composite Rating, EPS and RS ratings greater than 80 and an the SMR, Acc/Dis and Group RS at least an A or B. Finally, make sure the earnings and sales for the most recent quarter are over 25% and the estimates are over the current growth rate.

Buy the stock the next day and cut all losses at 8 % of your purchase price. Using this "investments for dummies" approach will narrow down the list of stocks you need to look at on a daily basis and will also have you focus on some of the best quality stocks in the market to put on your stock watchlist.

Good luck with your stock market investing!

Related Article

Stock Market Investing Today

Stock Market Investing Today - Smart Investing.


EmoticonEmoticon