There are thousands of stocks you can buy on the NYSE and NASDAQ and if you want to invest internationally, there are even thousands more. All in all, there are just too many choices for one person and so you must figure out a way to narrow things down that will help you find the handful of stocks you may want to buy. Figuring out which stocks to buy is something that is hard and something that I am always thinking about.
I do that by keeping my eyes and ears open all the time and by reading as much business and financial news as I can. Its about the only way I know of to become familiar with companies that I have never heard about that I might want to invest in. I use Flipboard (free) on my iPad and subscribe to the Business, Finance, News, and Technology sections which make it easy to flip through all the stories of the day.
What I Do To Find Potential Stock Picks
Every morning I take a quick look at the stocks I own as well as a few I am keeping track of. I have the Yahoo Finance Widget on my computer dashboard as you can see to the left. I can glance at it any time the market is open and immediately see what is happening and it displays real time stock prices which is nice because you don’t have to be signed in to get them.
When I click on any stock in that list it takes me right to the stock snapshot on Yahoo Finance and I can scroll down to see all the latest stories related to the stock. I like YF because it is simple, easy to access, has real time quotes, and the information is laid out in a nice format.
There is lots of stock market and financial information on Yahoo Finance and it can all be accessed for free. I often poke around looking for interesting stories on companies that are doing well and then I can punch in the stock symbols I read about to see more about those stocks. Then I try to determine whether they would ever be a candidate for me to buy or whether I have any interest in them at all. Most of the time I move on as it is hard to find good companies that I want to buy stock in.
Get Stock Ideas With MorningStar
Morningstar is another place to find good market information and get ideas on possible stocks to buy. You can sign up for a free account and never pay a dime but they will try to get you to sign up for a 14 day free trial of their premium service. With a premium account you get access to all their research data and analysis which might be something to consider but it does cost $22.95 every month.
For most investors who just want access to more material about the financial markets the free Morningstar account is enough. Remember, I just use them to get exposure to companies and/or industries I am unfamiliar with so as to get good ideas of possible stocks to research. My main way of doing that is by reading and that is what the free account on Morningstar provides.
I Follow Jim Jubak And Always Read His Thoughts On Stocks
Jim Jubak has written a stock market column on MSN for years and he also has his own website where he publishes a few more of his thoughts on investing. He also runs his own mutual fund that anyone can buy into. Anyone can read his blog/website for free and I suggest you take a look.
Mostly a conservative investor (which I like), he details his stock picks very thoroughly which is why I read what he has to say. His website has a couple of portfolios that lists the stocks he has chosen and you can read why he likes each one of them. When he takes a stock off the portfolio he lets you know why he is selling. Rarely do you find so much thoughtful analysis laid out for free and I have gotten some good stock picks from him in the past that have made money.
Warning, BS Alert!
There is a tremendous amount of fluff and fake stock analysis out there in today’s Internet world. The Motley Fool, Wall Street Cheat Sheet, and Seeking Alpha are three Internet publications that are pure GARBAGE and should be avoided. Those three pump out daily stock articles that are written purely for hype to get you to click on an ad or to sign up for their newsletter. The “reporters” or “analysts” or whatever they want to be called are for the most part, unqualified freelance writers that get paid by how many clicks their writings garner. All three try desperately to use article titles that are outrageous so as to attract attention just like the magazines at grocery store checkout lanes do. The stock stories these websites publish should be ignored as best you can but unfortunately, they seem to be everywhere.
Always Pay Attention To What Is Happening Around You
Unfortunately there is no magic way to find good stock picks. With so many companies in the world and so many new technologies and industries popping up almost every day, my advice is to always take in as much as you can around you. Be aware of what your kids talk about, what is being said at the water cooler at work, and read as much current news as you can. If you do those things you will hear about what things are popular, what people hate, and new trends that are developing.
For instance, you may want to buy Pinterest stock when it goes public later in 2014 but first you should do as much research on it as you can. Paying attention to who uses the site and what they are saying about it could make the difference between buying or deciding not to buy. Ultimately, that might be the difference between making money or losing money.
Keeping your ear to the ground and absorbing as much of what is going on around you will eventually lead to stock ideas. They say knowledge is power and that applies to investing. The more you know and the more you are in the loop with regards to the daily news, the better chance you have of hearing about good companies, good technologies, and good industries to invest in. No one is going to bring you a list of hot stock picks and if they do they surely have some ulterior motive. No, the hot stock ideas come from being a sponge and absorbing all that is going on in the world and then translating that knowledge into uncovering companies that are going to be profitable in the future.