Comments on: Stock picking

By: Notcho

Notcho — Sun, 06 Jan 2008 12:08:13 +0000

Isn’t holding individual stocks kind of like having a personal mutual fund except your the “professional” stock picker?
As Eden said “You can always make your money back with a winning stock, but a total loser will sink your portfolio for good”. This isn’t actually true. A loser can be sold and written off to offset capitol gains in your taxes and the winner hung onto for years.
Over the long haul, dividend paying stocks can add to your portfolio. I am a small investor and I look for a dividend paying stock where the dividend will give me around one additional share a year.
I also advocate dealing strictly with discount brokers to keep your costs down. Sharebuilder has dividend reinvestment where ScottTrade does not. Sharebuilder has a more limited selection of available stocks to buy. ScottTrade does not.
One other advantage of individual stocks is that you can buy into companies that a mutual fund can’t touch.

By: Eden

Eden — Fri, 04 Jan 2008 23:47:13 +0000

Investing in individual stocks is great- if you have the time to watch them and if you set stop loss orders. Generally, I’ll set a stop loss of 20% on every stock I buy, sometimes a bit higher percentage depending on the stock. You can always make your money back with a winning stock, but a total loser will sink your portfolio for good.

As for social investing, I don’t think much about it myself since our tiny little investments in these companies really have no effect on them whatsoever. That being said, I do draw a line- I would not for example invest in a company like Playboy Magazine - more for the reason that I wouldn’t want people thinking I endorse it, rather than the actual effect my investment would have.

Anyway, just my two cents. Good luck!

By: Bellen

Bellen — Fri, 04 Jan 2008 23:28:41 +0000

Over the years my husband and I have chosen stocks by analyzing what we use and the companies the products come from. For instance, we bank with Wachovia starting in CT, ending in FL and have never had a bad experience. So, we invested in their stock (yes, it’s dropped, but it will come back). We also look for companies that we feel will be around for a long time - currently those dealing with diabetes (babyboomers), artificial limbs (due to the Iraq situation). We feel it’s best to invest in what you know about.

By: bluntmoney

bluntmoney — Fri, 04 Jan 2008 22:38:29 +0000

Dividend Guy, nope, I haven’t looked at dividends. That should probably be the next step…

Neumes, thanks for the tip.

By: neumes

neumes — Fri, 04 Jan 2008 21:07:22 +0000

Keep trusting in yourself that you can succeed against the norm.

Stock market average returns are by definition made up of some stocks that do very well and others that tank. You can improve your investing skills and increase the chance of picking the great ones. Every market cycle has lots from which to chose.

If you haven’t aleady, either head to your local library or invest $1.50 at the grocery store for a copy of the newspaper, Investor’s Business Daily. I would never enter a trade without checking out my chosen stock there first.

By: The Dividend Guy

The Dividend Guy — Fri, 04 Jan 2008 16:03:58 +0000

Welcome to the world of stock selection. Sometimes it feels like the world is against you on this as index funds are the safer bet. However, with a good core portfolio of index funds individual stocks can be fun.
Did you look at dividends in your analysis?