Tuesday, November 9, 2010

How do I choose a stock to buy?

A share of stock represents part ownership of a company.
"What company would i like to own part of ? " ,  you might ask.  You want to own part of a company that is in an industry that you are familiar with. For me, because I am familiar with the Tech industy, I would want to buy stock in companies like eBAY or E*trade Financial Corporation , or Solera Holdings (SLH). In other words, technology companies.


"The technology industry includes thousands of companies" , you might think. "How did you narrow down your choices?" ,  you might ask. A stock quote provided me with the basic information that i needed to help me to make a choice. One of the pieces of information that can be found in a stock quote is EPS or earnings per share. This ratio told me what each share of stock in the company earns. For example, a quote for Solera Holdings:


EPS in the quote tells me how much each share of Solera Holdings is earning. If I buy 100 shares at the present  price ($50.36), I could earn $2.22
or $52.58 for each share I buy! Practice trading SLH. Do it now!

No comments:

Post a Comment