Learning different methods to do your own stock market research will enable you to make a better decision whether to, or not to enter into specific trading and investing positions.
Keep the brokers in check
In the past, many people relied on investment brokers to provide recommendations and whatever they said, was the way to go, or so they said.
As more and more people have seen what has happened with many investment brokers over the past few years, it is now more important than ever to educate yourselves to be involved in the final decision making process.
Not to say that there aren’t any good investment brokers, but when they provide a recommendation, there is nothing wrong with you doing a little research on your own to verify if the recommendation is right for you.
Who are you?
If you are an individual investor or trader, learning what stock research methods are available will play an even more important part of your trading plan. Without performing some type of research, the outcome of every trade will only be luck, some good luck and some bad luck.
There are many different methods to do your own stock research and how much and what types will depend on the trading strategy that you are using. Learning about different types will allow you to choose from several and try out different ones.
Different Stock Market Research Methods
Here are some of the different Stock Market Research methods you can learn about:
- Technical Analysis: Using Technical Indicators on Stock Charts to help identify and verify trading opportunities.
- Fundamental Analysis: Looking at the financial information of a company, the management, how the company is doing against it’s competitors and how the specific sector is doing now and is expected to perform in the future.
- Quotes: Yes, learning to lookup stock symbols and quotes and the resulting data that often is provided with a quote such as Bid, Ask, EPS, 52 Week Highs and Lows should be explored.
- Stock Charts: There are several types of stock charts that can be used. Learning about each one will help you choose which one is right for you and for specific types of analysis.
- Stock Screener: Using a Stock Screener will help you narrow down your stock picks by making sure they meet pre-determined parameters.
- SEC Filings: If your strategy includes making sure there is Insider buying or Selling recently, following SEC filings will be a benefit for you.
- Stock Trading Software: There are different types of Stock Trading Software that perform analysis and scans for you. Once you find a good software product to fit your trading style, it will save you much of the time that would otherwise be needed to do the research yourself. Remember though, if a software product produces a result, do some checking yourself just as you would a live broker recommendation.
- Community Forums: Have an idea but would like to see what others have to say? Submitting your idea to a forum with other traders like yourself may result in some useful insight.
Turn Research into Strategy
You can see that there are many different methods of performing stock market research, and this list is by no means complete. There are other methods you may be learning about as you advance your skills. These methods above are some of the most common and each one can be explored further to provide as little or as much detail as needed for different trading strategies.
Once you have a base of knowledge in different research methods, you can look at your specific trading strategy and narrow down your list of methods you use to fit your strategy as needed. Some trading strategies will use several research methods combined, and others will only use one. The one’s you use will be determined by what you find to be useful for your specific strategy based on testing and examples.