Learning one or two stocks as a trading technique

[Steve C]

Hi guys,

Just after some insights, As a little side project, I was thinking about choosing one or two stocks and learning what makes them tick both technically and fundamentally and then trading them.

*Does this work?
*What sort of stocks would this technique be most suited to? I was thinking nothing to speccy but also not a bluechip to make it worthwhile.
*Can anyone make any suggestions about what exactly I should be researching to make an informed buy/sell decision?

Thanks for any advice/tips,

Steve

 

[beachlife]

Sounds like a good idea, but I would say make sure they are from different sectors and pick ones that have a history of trending.

 

[darkhorse70]

Well from what ive read I forgot exactly for how long but maybe 1/3 or 2/3 of the time stocks are just moving sideways. So having 2 stocks as your option of trading will greatly limit your potential. Also sentiments change over time and a stock which was once a good option for traders might not be anymore. You should find a handfull of stocks which fit your criteria and keep an eye on them so when one movies in a favourable position u can strike. Just pick stocks that arent to mature. They are liquid enough but not too liquid. This way you can still expect volatility but predictable volatility. Find shares which arent too expensive nor too cheap. Find shares which have more speculation such as tesla. They are based on hope and potential future profits. You know how ppl always love lotto haha. Find good stocks with good patterns which respect their important lvls etc. Thats all I can think of. Oh and yea im a noob so take this advice with caution.

 

[burglar]

Been feeling pain with my Iron Ore position ... I thought it may signal the bottom.
So I did a quick Google and found these two articles:


commodity=iron-ore

... now is the time to pick up some quality iron ore stocks.

See Link



This does not constitute advice, so do your own Googling.

 

[minwa]

Been feeling pain with my Iron Ore position ... I thought it may signal the bottom.
So I did a quick Google and found these two articles:


commodity=iron-ore




See Link



This does not constitute advice, so do your own Googling.

Articles means nothing, I just googled and I find articles saying Iron Ore will continue to fall. http://www.smh.com.au/business/analysts-downgrade-iron-ore-forecasts-20140624-3apz9.html
http://www.forbes.com/sites/greatsp...test-iron-ore-price-slump-causes-and-effects/

People often search for articles from expert analysts and read it to feel better about their own positions. You can always find equally convincing articles for both bulls & bears.

 

[burglar]

... You can always find equally convincing articles for both bulls & bears.

It is true!
Analysts need to say something interesting, even when they don't know the truth.

 

[So_Cynical]

Hi guys,

Just after some insights, As a little side project, I was thinking about choosing one or two stocks and learning what makes them tick both technically and fundamentally and then trading them.

I think this can work, after a while you can get a fairly high degree of confidence in a stock...and then a sunrise will come along and you can feel like that confidence was just an illusion...time is needed to see out the bigger moves.

 

[ROE]

Hi guys,

Just after some insights, As a little side project, I was thinking about choosing one or two stocks and learning what makes them tick both technically and fundamentally and then trading them.

*Does this work?
*What sort of stocks would this technique be most suited to? I was thinking nothing to speccy but also not a bluechip to make it worthwhile.
*Can anyone make any suggestions about what exactly I should be researching to make an informed buy/sell decision?

Thanks for any advice/tips,

Steve

Yes it does,I am doing it all the time and that the only thing I do with trading
I use fundamental only and never use charts even for trading in and out.

I know enough to know at this price I buy and it goes lower I buy more and buy more until such
time I can exit for profit .....

I have not loss any money up to date infact my capital gain is very substantial

I mainly trades strong balance sheet and cash flow positive business because of this strategy
I cant afford to bet on specs stock going down but I am always 100% confident doubling up
on strong balance sheet and +ve cash flow business going down.

I trade small and midcap strong balance sheet stuff from 100m - 8bn market cap but my over all theme still buy and hold good business and collect dividend ...70% of my cash are lock in that..

I normally trades the same stuff I hold long term as in say I got 10,000 RFG shares holding
and I want to profit from it sideway or playing dividend stripping .. I would buy another 10,000 - 15,000 shares just for that purpose of getting in and out and if **** happen I hold 20,000 for dividend or buy another 10,000 if it drop another 10-15% etc... when it rally back I exit the trade parcel and repeat for all the business I hold long term...

you need to work out a strategy for yourself and act with confident not getting freak out because
charts telling you the stock is collapsing or some news headlines on its business.

 

[billr]

Hi guys,

Just after some insights, As a little side project, I was thinking about choosing one or two stocks and learning what makes them tick both technically and fundamentally and then trading them.

*Does this work?
*What sort of stocks would this technique be most suited to? I was thinking nothing to speccy but also not a bluechip to make it worthwhile.
*Can anyone make any suggestions about what exactly I should be researching to make an informed buy/sell decision?

Thanks for any advice/tips,

Steve

Stick to the top 100 stocks for this sort of approach. Focus your efforts by finding three or four stocks you enjoy following that show some volatility and regular movement. Have a look at Marcus Padley's site, he has a good article that talks about the possibility of a one stock portfolio. He mentions a friend who does this very successfully. I am not a subscriber but you can get a free trial.
Having a one stock portfolio has the great benefit of focus which frees you up from too much choice in the market. This enormous choice often leads to info overload and inaction because no human on earth can absorb it all and make consistent use of it. The more you narrow your focus the more chance of success.
These are my own views and I expect others will have their own views. I am not any sort of expert but if I can leave any advice it is not to ever average down or fly without strict stop losses in place. This will help you sleep at night.

Both technical analysis and fundamental analysis are full of flaws, neither can be fully trusted.

 

[Steve C]

Thanks for the replies everyone - now to pick a couple of stocks that are of interest to me and match the criteria.