Explore the strategies investors use to choose stocks and learn whether it’s better to be an active or passive investor.
—
Every day, billions of stocks are traded on the New York Stock Exchange alone. But with over 43,000 companies listed on stock exchanges around the world, how do investors decide which stocks to buy? And what do individuals and institutions achieve by investing in stocks? Richard Coffin explores the tactics of different investing strategies.
Lesson by Richard Coffin, directed by Franz Palomares.
Support Our Non-Profit Mission
———————————————-
Support us on Patreon:
Check out our merch:
———————————————-
Connect With Us
———————————————-
Sign up for our newsletter:
Follow us on Facebook:
Find us on Twitter:
Peep us on Instagram:
———————————————-
Keep Learning
———————————————-
View full lesson:
Dig deeper with additional resources:
———————————————-
Thank you so much to our patrons for your support! Without you this video would not be possible! Chung Wah Gnapp, Amber Alexander, Robert Patrick, Pi Guanghui, Barbara Younker, Ai Ejima, Soma Ali, Roman Pinchuk, Raheem, Hector Quintanilla, Leen Mshasha, Mariana Ortega, Danny Romard, James Bruening, Ricki Daniel Marbun, Malcolm Callis, Sabrina Gonzalez, Al the Scottish Wildcat, سلطان الخليفي, Alexander Walls, Della Palacios, Vik Nagjee, Hiroshi Uchiyama, Adi V, Andrew Bosco, Craig Sheldon, Rishi Pasham, Joanne Luce, Jason A Saslow, Mary Sawyer, Scott Gass, Ruth Fang, Mayank Kaul, Kathryn J Hammond, Max Shuai Tang, Terry Minion, Sami Khan, Rob Johnson, Abdullah Abdulaziz, Angelo Urzua-Milla, Tommy Lewis, leorene, Mahina Bachiller, Marcus Andre Nery, Bruce Vieira Lopes, Chef, Charmaine Hanson, Michael Goldberg and Lydia Pflieger….(read more)
LEARN MORE ABOUT: Treasury Inflation Protected Securities
REVEALED: Best Investment During Inflation
HOW TO INVEST IN GOLD: Gold IRA Investing
HOW TO INVEST IN SILVER: Silver IRA Investing
How do investors choose stocks?
Investing in the stock market can be a daunting task. With thousands of companies listed on various stock exchanges, it can be challenging to pick the right stocks that will provide good returns. However, investors have developed several strategies to help them make informed decisions and navigate the volatile world of the stock market.
One of the most popular methods investors use is fundamental analysis. This approach involves evaluating a company’s financial health, including its revenue growth, earnings, debt levels, and management team. By analyzing these factors, investors can determine a company’s intrinsic value and whether its stock is undervalued or overvalued. Fundamentally strong companies are more likely to generate consistent profits and offer long-term growth potential, making them attractive to investors.
Another approach is technical analysis, which involves studying past market data and stock price patterns. Investors who use this method rely on charts, indicators, and trends to predict future stock movements. Technical analysts believe that historical price movements and patterns can provide insight into future price movements. While some investors find technical analysis useful, critics argue that it lacks a fundamental basis and is more akin to speculation.
Investors also consider market sentiment when choosing stocks. Sentiment refers to the overall attitude and feeling of market participants towards a particular stock or the market as a whole. Positive sentiment can drive stock prices higher, while negative sentiment can lead to declines. Investors assess sentiment by analyzing news, industry trends, and other sources to determine whether there is optimism or pessimism surrounding a stock. A stock trading with positive sentiment might be a favorable investment option.
Additionally, investors may analyze macroeconomic factors. These include factors such as interest rates, inflation, economic growth, and government policies. Economic conditions can have a substantial impact on companies and their profitability. For example, during periods of high economic growth, companies in industries such as technology or consumer goods might do well. Conversely, during an economic downturn, sectors such as healthcare or utilities may be more resilient. By understanding macroeconomic factors, investors can make strategic decisions about which sectors or industries to invest in.
It’s worth noting that every investor has their own investment style and strategy. Some investors prefer a value-oriented approach, seeking companies that are trading below their intrinsic value. Others may be more growth-oriented, looking for companies with high growth potential even if they may appear overvalued by traditional measures. Some investors may also focus on income-generating stocks, such as dividend-paying companies, to provide regular cash flow.
Finally, investors should always conduct thorough research and due diligence before investing in any stock. This includes reading company reports, understanding the industry dynamics, and keeping up with news and market developments. Investing in stocks carries risks, and it’s essential for investors to be well-informed and prepared.
In conclusion, investors choose stocks through various strategies such as fundamental analysis, technical analysis, market sentiment analysis, and macroeconomic analysis. Each approach has its strengths and weaknesses, and investors often use a combination of strategies to make informed decisions. Regardless of the method, thorough research, analysis, and staying updated with market developments are crucial for successful stock investing.
To reduce risk, I wish to diversify my portfolio across different stocks and sectors. I've heard of folks making over $550,000 during recessions; how can I do the same?
Hey, man, thanks for your trading guidance! It helps a lot
I'm also a proud beneficiary of sam deymon trade! I've built my portfolio massively. I'm way up to the profits now…I pray this week bring us all good tidings.
HOW PAINFUL I HAVE INCURRED SO MUCH LOSSES TRADING ON MY OWN…I TRADE WELL ON DEMO BUT I THINK THE REAL MARKET IS MANIPULATED… CAN ANYONE HELP ME OUT OR AT LEAST TELL ME WHAT I'M DOING WRONG ?
I am new to the stock market. Every stock that I bought so far, I was out of luck because I bought them when they were expensive. I feel I missed out on all the stock opportunities so far for the tech stocks.I believe having 150K yearly income would be a good investment so I want to plug all my savings into the stock market. I know this sounds a bit dull but I would like to know if I should learn investing or let somebody else (more capable like a FA) do it for me? Please share your thoughts. I am kind of tired of searching for a good stock to buy and losing all the good opportunities
I will be forever grateful to you, you changed my whole life and I will continue to preach on your behalf for the whole world to hear you saved me from huge financial debt with just a small investment, thank you Mrs Mitchell Anderson .
I'm from England where i work as a journalist until i met Expert Mrs Amanda K, Mrs Amanda K is legit and her method works like magic. I keep earning every single week with her new strategy
Buying a stock is easy, but buying the right stock without a time-tested strategy is incredibly hard. Hence what are the best stocks to buy now or put on a watchlist? I’ve been trying to grow my portfolio of $260K for sometime now, my major challenge is not knowing the best entry and exit strategies… I would greatly appreciate any suggestions.
My advice to new investors: Buy good companies stocks and hold them as long as they are good companies. Just do this and ignore the forecasts and market views which are at best entertaining but completely useless.
Don't forget that Charlie Munger and Warren Buffett invented the idea of investing and buying at both market highs and lows. As Warren Buffet noted, he has witnessed this occur frequently during his life. I'm not a trader. Never did my husband and I make more money than others in the middle class. With a $4 million stock portfolio, we intend to retire at age 58. Never have we ever sold even one share of stock…
You are right! I diversified my $500K portfolio across various market with the guidance of an investment coach, I have been able to generate a little bit above $1m in net profit across high dividend yield stocks, ETF and equity during this red season in the market But the truth is that you cannot do that without a tested trading strategy.
Exactly why i enjoy my day to day market decisions being guided by a portfolio-coach, seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/ analvsis they have, it's near impossible to not outperform, been using a portfolio-coach for over 2years+ and I've netted over 400k with samdeymon
There are lots of mixed opinions about stocks and there projection in the next coming years, I aim for short term solid gains from market correction and I'd definitely jump on the boat if I knew a thing or two about day-trading, but then again what do I really know? I'm just looking for the right moves to grow and hedge my stagnant reserve of $370k from inflation.
What could be the most secure and efficient way to invest in cryptocurrencies? I've done some research but am still unsure; advise please!
I started investing in the stock market because of dividends. What matters, in my opinion, is that if you invest and earn more money in addition to dividends, you will be able to live off of dividends without selling. It implies that you can pass that on to your children, giving them a head start in life. I've invested over $600k in dividend stocks over the years; I continue to buy more today and will continue to do so until the price lowers even further.
Good video. As for me i have made huge profits on my investment since i started trading with Julia David, her trading strategies are top notch.
U.S stocks found their footing in the final hour of back-and-forth trading Monday after all three major index logged their worst week in three months, Heard someone say the best season for a financial breakthrough is now, especially with inflation running at a four-decade high. I'm still at a crossroads deciding if to liquidate my $117k stock portfolio, what’s the best way to take advantage of this down market?
How do hedge funds pick stocks?
i fell asleep…sorry guys
Exro technologies
Excellent video! I have 959 shares of SCHD in my dividend portfolio and 1670 shares in an IRA. SCHD has recovered much more than the broader market. I think there is more upside in QQQ/VTI/VOO. I already did DRIP my dividend from SCHD on 12/12/22 back into SCHD. Finally hit the 7 figure mark on my portfolio I'm grateful for my broker James Fletcher Brennan, he handles all my investments and ensures I stay above the market..
Ted Talks, you guys have me deepest gratitude.
Hey what if schools never existed
Nobody can become financially successful overnight. They put in background work but we tend to see the finished part. Fear is a dangerous component, hindering us from taking bold steps we need in other to reach our goals. you have to contend with inflation, recession, decisions from the Feds and all. I was able to increase my portfolio by $289k in months. You have to seek for help in the right places.
Buying a stock is easy, but buying the right stock without a time-tested strategy is incredibly hard. Hence what are the best stocks to buy now or put on a watchlist? I’ve been trying to grow my portfolio of $260K for sometime now, my major challenge is not knowing the best entry and exit strategies… I would greatly appreciate any suggestions.
Watching your videos and it's helpful to me because investing money was difficult to me back then, until I stumble across professional advisor Emily?
Great video. I make huge profits on my investment since i started trading with a professional broker Mrs Willow Harp, her trading strategy are top notch coupled with the little commission she charges on her trade. Thanks so much ma'am ❤️
There are lots of mixed opinions about stocks and there projection in the next coming years, I aim for short term solid gains from market correction and I'd definitely jump on the boat if I knew a thing or two about day-trading, but then again what do I really know? I'm just looking for the right moves to grow and hedge my stagnant reserve of $370k from inflation.
It's so awesome to discover that The Plain Bagel makes TED-Ed lessons too!
i'm glad I got into crypto when I did because it’s been a turning point for me financially,been my best decision so far
2:50 is where I'm most confused. If public opinion is what drives short term fluctuations, why can't public opinion drive long term prices as long as the company stays in business? Barely any companies pay a >3% dividend. Why do profitability ratios determine your value in the long run?
people never know how to avoid making mistake while trading, you need to get full understanding and knowledge it is not something you just gamble, Mrs Stacy.consistent and constructive. I am getting thel best from it.
Stock market is not far long term
Hi TED-Ed, I'm very impressed by your videos and attention to detail. Inspiring and to the point. Who or what was your inspiration to start creating video content?
Nice Index Update Vedio
https://youtu.be/ztLuLmVDtlc
https://youtu.be/CMQLdJa64Wk
RBI Policy Next Week
https://youtu.be/Zv8NFiwQpP0
MY portfolio has good companies, however they have been red all this year. This is my first year of investing and have been down 35% in the March/April sell off, and now down 17% in this sell off. I work hard for my money, so investing is making me nervous and sad. I don't know if I should sell everything or just sit and wait.
This is perfect for beginners