You need to determine which criteria you think are important in choosing an individual company to invest in.
Do you know even the basics? For example, do you know what a PE (price to earnings ratio) is? THAT is how you determine if a stock is cheap or expensive.
Do you know how to read a balance sheet or annual report?
If you are savvy (and not everyone is) you can really make more money choosing individual stocks but you MUST do your research and know what you're doing. And even then, you're going to screw up - I can guarantee it.
But if even ONE of four stocks you pick is a winner, you'll do great.
That being said, it is a part-time JOB to select and monitor individual stocks.
Motley Fool is a good resource to learn some basics.
And for stock research, there isn't any better tool than Value Line in my opinion. Most urban city public libraries have Value Line that you can look at in-branch or on-line simply by being a library card holder.
Good luck!
P.S. Any monkey can pick mutual funds, especially index funds. But when you choose individual stocks you have to CONSTANTLY monitor what is going on. It's not enough to decide what to buy...you have to study how long to hold (maybe forever, maybe only six months) and when to get the HECK OUT.
I am new to the concept of investing in individual stocks, though I have been a long time user of several mutual funds in which I have 70% of my money. I am in my early 20s, single, no debt, and am looking to purchase some individual stocks - mainly for my own interest and the pride that can come with being responsible for my financial performance.
I am looking to invest about $2k-$3k in individual stocks this summer, after I have done a good bit of homework on strategy and narrowing down my options on what I would like to invest in. My question is, having already established index funds for myself, what would be good strategies on putting the 2-3k to its best use in individual stocks?
Note: not asking for stock picks, but rather things like small quantities v large orders, more expensive stocks v cheaper stocks, ect....
Thank you in advance :)
