How to plan effectively before purchasing stocks from stock holder?


You know there are some activity going on with the stocks that you don't want to get into a stock. You're one of the few shareholders of it which makes it really hard to get in and out we call that liquidity. So we're looking for stocks with at least more shares traded on average. Then in terms of a price we're looking that these stocks are at least greater than 10 dollars per share. 

Here's this term mentioned again liquidity. We want to make sure that these stocks have a lot of activity and then we want to make sure their bid-ask spread is fairly narrow. Now the bid price is what the market wants you to pay for it or sell it for the asking price. They're asking you to pay for it and so you don't want the spread between those two prices to be really big. This is because that means you have to make up more of that.

What are the plans to make before purchasing stocks from stockholder? 


Let's come over here to the scan tab to see what we can identify. Here, so we're going to come back and I'm going to reset this. I was making sure our scan was going to work really good here. Today, if you got a sneak peek at that good for you. We're going to go through and set this up line by line. 

Now, when you first come into where we are which we are on the scan tab, we are in the stockholder. That's the program we're using this is the look that it has by default.  You had a quick question here about where is this plan, where I showed you to get it is you go into the stocks technical analysis course. You go down to the bottom after all the lessons and it says resources and then that very first link. 

Few Investing Plans Before Purchasing Stocks :

There is a sample investing plan. So you should be able to hopefully identify that again. Now when we pull up stockholder. We have the word stock and then we have three variables next to it. It means that this variable of net change came from the filter of stock as did these others the volume and the per cent change over here. 

We have plus add the filter and that is where we're going to get the different types of criteria. Example in this list is stock and there'll be some other things that we're going to select. That's where they come from the kind of mesh together. So let's start out with we have our stock criteria here and we don't have to keep these default ones. We can change them to anything on our stock filter list the one that I'm going to choose here is going to be last for the last price. 

So we're going to put that in and what are the investing plans. It uses a minimum of ten dollars, so we're going to plug in our ten dollars. Now some of you might like a higher threshold than that is just fine. Now go ahead and put in where you're comfortable now. The next criteria that we're going to use here are more of fundamental criteria. 

It's not going to be in the stock criteria volume. Here, means volume today that we really want more volume than just what's happened. Today to give us an idea and the per cent change is just what's happened. So far those aren't necessarily good criteria for the list that we want to build. So, we are going to get rid of them it's going to click on this at the very right-hand side. 

Fundamentals to increase price earning ratio:

We're going to add more on our filter. So next let's choose a couple of fundamentals and I'm going to pick this out this twice. We're going to put in two different criteria here. Now the first one we're going to put in is a price-earnings ratio. Those of you that may I'm going to call you people that are fundamentally oriented or something of that nature you might be very keen on using a price-earnings ratio

Those of you that are not familiar with the price-earnings ratio essentially means how much money do you need to pump into the stock to get a dollar of earnings out. If you think about it would you prefer to pump ten dollars into a stock to get a dollar of earnings out or would you prefer to pump fifty dollars into a stock to get a dollar of earnings out? 

Some of you might be trending towards that lower number right. You'd rather put in fewer dollars to get your same one dollar earnings out now on growth stocks sometimes these ratios are really high. The reason they're really high is that there are big anticipation and expectation that this stock is going to soar and people are willing to pay a higher price for that stock. 

So we're going to put a number in here. We're going to put seven on the low end and we are going to cap this one. We're going to put 80 at the high end some of you might not feel comfortable at an 80. Some of you might that have been using this variable. You might have a heart attack over it. 

We are going to put in a return on equity and a return on equity that is higher means it gives it the idea that the stock is still in growth mode. It hasn't plateaued or matured all right because we're still looking for that growth. So, we are going to put in on the return on equity,  just for the current year, we're going to put in a minimum of 15 per cent.

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