Wednesday, August 22, 2007

Unlock Stock Market Profits - Key #4

This is the fourth article in a series of posts describing 10 tools to help you identify and evaluate good investing ideas. It is based on a post that provides a summary of the ten keys that individual investors should use to identify profitable stock trades. (Click here to read the original post)

With this fourth post, we will continue another step along the path of finding stocks that seem to have some potential. The first post in the series discussed how to use unusual activity to identify investing ideas. The second post described how to use stock screeners. The third post described how to use lists of new highs and new lows. This post will focus on identifying social or business trends in order to find investing ideas.

Information on new trends might turn up anywhere. In conversation with friends or business associates, in newspapers or magazines, on TV or though your work. The key is to be aware of trends and how they start, stop or change. We'll start by describing what to look for, then we'll list a few ways of finding information.

Needs and desires --

Observe how needs and desires change over time. Note that there is a difference between needs and desires. In either case, however, changes translate into new markets created and goods and services provided.

Desires can be thought of as tastes and preferences. Most people didn't need an SUV but many people preferred to drive an SUV. Is that trend changing now? What companies will benefit from the change? Everyone likes big screen TVs -- who makes them or the parts that go into them?

As for needs, it is clear everyone wants to be healthy. The baby boom generation will soon be retiring in droves. The elderly tend to have more health problems. This train of thinking leads pretty directly to the conclusion that it might be a good idea to beef up the portion of your portfolio devoted to health care stocks. Here is a case, however, where we have a very broad trend that we recognize. In this instance, it might be more reasonable to choose a health care mutual fund or ETF rather than try to identify the one or two stocks most likely to benefit.

Doing the right thing --

In general, people like to do the right thing. This might not always be true of certain companies but for most individuals it holds true. Trends based on doing the right thing often take quite a while to develop before achieving the critical mass that allows real markets to be formed to address these trends.

An example of this is the "green" movement. Individual consumers demand a cleaner environment and less waste. Companies eventually respond with fuel cells, solar panels, wind farms, new recycling techniques, etc. This trend has been around for decades but it is only recently that the largest companies started listening by developing hybrid cars, for example. The "green" market is just beginning to mature and keeping an eye out for companies that can take advantage of this trend will surely produce stock market profits.

What to watch out for --

Many stocks, especially small young companies, see their stock prices skyrocket based on a single product. Don't forget to ask yourself whether the company producing that product can sustain profits and continue to grow.

Avoid short-term ephemeral trends. An investor can end up chasing the flavor of the day rather than tapping into a long-term growth story.

Where to find ideas --

Many of the following have both print and online versions and it is often a good idea to subscribe to their RSS feeds or email newsletters.

  • Newspapers - the oldest media example but still useful. Newspapers are more likely to provide thoughtful, in-depth analysis than a simple blog post. I myself can't do without the Wall Street Journal. Others prefer Barron's or the New York Times. Read a paper and look for those articles that might give a glimpse of the future.
  • Magazines - Wired, for example, might be earlier at identifying trends than a more mainstream publication like Time magazine. Still, it pays to read widely and be curious.
  • Blogs - Gizmodo, LifeHacker and others are good at discussing the latest trends among the techies of the world. They often have blogrolls listing other similar blogs; surf a few and see what you find.
  • Marketing - eMarketer, for example, examines trends in Internet marketing which is something I happen to be interested in. There are other marketing web sites that address various kinds of industries and marketing approaches. They are often trying to latch onto the next big thing or understand the latest cultural goings on. Articles published on these sites can be early warnings of trends about to hit the mainstream.
  • Metrics - Nielsen is always trying to identify trends on line and off line. Some of their data is free. Look around for other measurement companies and data. This can sometimes tip you off when a trend is beginning to develop some critical mass.
  • Universities - I myself subscribe to the email newsletter from the Wharton School of Business at the University of Pennsylvania. There is usually at least one interesting article in each edition. Experiment with different universities known for their "talking heads" and experts; subscribe to feeds or newsletters. You never know what might pop up.
  • Industry web sites and publications - you don't always have to be a subject matter expert to be able to benefit from industry news and announcements. If you think an industry sector has something going on, visit company websites or industry association web sites and see what is getting the most attention.
Conclusion --

It is within the grasp of all of us to identify trends in business, lifestyle or culture. Being aware of what's going on around us and being able to apply some perspective should help us identify markets that are growing and hopefully avoid those markets that are shrinking. In today's global marketplace, it also pays to be aware of other cultures and countries and the trends taking place there.



18 comments:

Anonymous said...

Hi everyone,
Your blog is quite nice and informative.
We hope our information will be quite useful for your users also.
As we can see Dollar is becoming weaker day by day as compared to Indian Rupees, which is affecting IT Sector Still IT sector got lot of potential as is due to zoom up once again.

Moreover Recently we have witnessed that Indian stock market has touched new heights surprisingly IT sector was not part of it.

Now NIFTY is already in overbought zone. We can expect NIFTY and SENSEX to fall bit that is correction is due.

Best strategy now- For investors wait for minor correction and buy IT stocks at dips.

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Regards
SHARETIPSINFO team

Anonymous said...

Hi
Your blog is quite nice and informative.
As far as stock market is concerned. Trading in market requires
both time and Knowledge. Without these two factors its impossible to trade .
If you get recommendations from some specialist then also you must keep in mind its your money you
should invest it wisely. Its always advisable to get recommendations from analyst but again before investing you should do your research also.


We suggest you one thing never ever work on any rumour because rumours are spread to meet personal goals.

Regards n love

SHARETIPSINFO Team

Team: www.ShareTipsInfo.com said...

Hi Everyone.

Your blog is nice and informative. We think your visitors will like this posting.

We all know that Indian stock market has become volatile now a days. One day its going up and another day its coming down. So we all should like to know
what is the reason for it.

Well We say its the game of FII how they direct the market. They have huge money with them they can direct any share as per there needs and requirement.
Now its a alarming time.

We suggest you to be very much beware now as year closing of FII is on the cards. There year closing is based on year to year basis. Not like ours i.e. March.

So many will try to invest more money and rest will try to take there profit back home. In this scenario its best to follow market trend and work with small
quantity. Just wait and watch.


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SHARETIPSINFO Team

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www.ShareTipsInfo.com Team said...

Hi Everyone,

This Blog is really nice and helpful. We hope our post will be useful for all visitors of this prestigious blog.

On 29th Feb 2008 budget was declared. It was expected to be in favor of middle class people . As in budget all loan of farmers were waived off, its a
Positive news for farmer which can give rise to agro based industries too.

Overall budget was good for everyone.

Now with time USA is coming out of the jinx of sub prime and recession and we have already witnessed some good movement in US market too. Recent fall in Indian stock market was due to Overbought Nifty, USA recession margin pressure and panic.


Now Nifty is in consolidation phase. Once consolidation is over we will see major rally in the stock market.


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1. RCOM

2. GDL INFRA

3. DISH TV ( Only above 66 )

4. RPOWER

5. HFCL


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Thanks

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ShareTipsInfo Team

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KnowYourProfit said...

This blog is quite nice and informative , we had a pleasure to post a comment on this usefull blog created by the webmaster

Tomorrow i.e. 31st July'08 the day when the Inflation data will come.Inflation from the past successive weeks is keep on increasing,this has now become a major factor deciding the following days movement of Indian Stock Market.RBI and the government is taking steps to control it.Inflation has to be kept under control for the interest of the economy, Indian Stock Market is governed by lots of factors one including them is Inflation that has also to be kept in mind always

Sectors giving good return over period of time includes:

1.INFRASTRUCTURE
2.PHARMA

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Team
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shareinfoline said...

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KnowYourProfit said...

This blog is novice and informative,it is a pleasure to post a comment on this usefull blog created by a webmaster

Now as such the final stages of the formal completion of nuclear deal has come,so we can expect some positive news effecting the
movement of the INDIAN STOCK MARKET which means stocks coming in power sector will take new direction

Companies which will benefited includes mainly

1.Larsen n Tourbo(LT)
2.Hindustan Construction Co. Ltd(HCC)

and the list had few more names..

Happy Trading

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Team
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KnowYourProfit said...

This blog is novice and informative,visitors will surely be benefitted,Its our pleasure to post
Informative content on this useful blog created by webmaster.


Now as such we have seen in past few trading sessions that Market has become volatile
and also there were also most of the stocks are available in discounts which means that
the right time has come when one can invest in this
Indian Stock Market with
handsome gain in over a period of time along with that one can also opt for
doing Intrading Trading now
days as stock specific movement is there.

Quieries are welcomed at:

Happy Deepwali and Happy Trading as well

KnowYourProfit
+91-9871142419

Anonymous said...

Hello,
Stock market is a volatile market. Investors are afraid of entering Indian stock market due to such volatile conditions. FII are the one who are selling
shares like anything. Now we can see some relief rally in the market but still recession can curb the movement of the stock market. In these sort of market investors and
traders are confused like which stock they should select that is stock selection is the major issue now.

Have any doubt lets discuss it and help everyone

Happy Trading,

ShareGyan

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Anonymous said...

Stock market is a volatile market. Where people invest with the intention of making money but many traders and investors end’s up as a looser. Must be wondering what makes one trader a winner in the stock market and another one as a looser in the market.


Apart from this result season is also going on. Though not that favorable results are expected this time. But INFOSYS came up with very good results now we need to wait till giants like RELIANCE, SBI and other declares there numbers. As they will be responsible for further market movement.
For now we strongly suggest everyone not to take too many deliveries in there portfolio. Just wait for some more time for quality value buying.

In Indian stock market many people have many doubts but they don’t want to clear them by consulting professionals nor they want to raise there questions where other traders and investors can help them out. But now many portals are coming up with QNA sections where investors and traders can exchange there views about stock and stock market. Indeed it’s a great help for everyone who are related to stock market.



Regards
SHARETIPSINFO TEAM

sharetipsinfo said...

Now result season is going on and results are not that positive in broader terms. More or less results are mix for Indian companies. Still Regards Indian stock market requires one triggering point which can give clear trend in the market.

Still Nifty is in mix zone. Nifty will be bullish only if Nifty manages to trade and sustain above 3150-3200 level below these levels bears will rule the dalaal street.
Few Stocks to stay away from for short term
1. DLF
2. Satyam comp
3. Bharti Airtel
4. Tata steel
5. Rcom

Please feel free to contact us for any query.


Regards
SHARETIPSINFO TEAM

sharetipsinfo said...

Now result season is going on and results are not that positive in broader terms. More or less results are mix for Indian companies. Still Indian stock market requires one triggering point which can give clear trend in the market.

Still Nifty is in mix zone. Nifty will be bullish only if Nifty manages to trade and sustain above 3150-3200 level below these levels bears will rule the dalaal street.
Few Stocks to stay away from for short term
1. DLF
2. Satyam comp
3. Bharti Airtel
4. Tata steel
5. Rcom

Please feel free to contact us for any query.


Regards
www.ShareTipsInfo.com Team

Call at:-

+91-9891655316
+91-9899056796
+91-9891890425

On Yahoo Messenger Chat Id: ShareTipsInfo or ShareTipsInfo_1

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Mail at:-
contact@sharetipsinfo.com
sharetipsinfo@yahoo.com
sharetipsinfo_1@yahoo.com
sharetipsinfo@gmail.com

Anonymous said...

Hi,
It’s a well know fact that stock market is affected by elections and now Election 2009 are about to begin in some time so for sure they will also have some sort of impact on Indian stock market.
One can find complete report on Impact of elections on stock market Apart from Elections another major concern for Indian stock market is Inflation. There was a time when we were concerned about rising inflation but now we are conscious about this falling inflation.

So big question is what should day traders and investors do?

Frankly speaking day traders are least concerned about the market they simply follow trend and make maximum out of it. But yes investors should keep there portfolio light till the elections get over.

Please feel free to contact us for any query.


Regards
SHARETIPSINFO TEAM make some extra money.


Please feel free to contact us for any query.


Regards
SHARETIPSINFO TEAM

sharetipsinfo said...

Dear Visitors,

This blog is really nice and informative. We are pleased to know this blog is really helping people. It’s our pleasure to post informative content on this useful blog created by webmaster.

As budget season is approaching so it is wise to think before investing as we can witness very volatile market in coming days. Moreover, we are expecting some stock market correction in post budget session


We advise every investor to book profit before budget and try to grab value stocks at further decline for short to medium term.

For any query feel free to contact us.

Regards
SHARETIPSINFO TEAM

+91- 9891655316
+91- 9899056796
+91- 9891890425

sharetipsinfo said...

Hi,

Indian stock market is one of the most volatile market. Its two main stock exchanges are NSEand BSE. Both exchanges generally follow same trend.

NSE and BSE offers platform for investment in Indian stock market. In India there are many traders who prefer NSE over BSE as they consider BSE
as more volatile exchange but truth is that all exchanges be it NSE, BSE or LSE are volatile and should not be considered as a place for speculation.
One should strictly follow technical analyses if they want to earn regularly from any stock market.

Please remember analyses of stock market be it technical or fundamental do help!!

Regards
SHARETIPSINFO TEAM

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