Friday, August 12, 2011

How to Buy Stocks at Bargain Price

Many good stocks are often available at bargain prices.With some basic tips and tricks, you can easily spot these stocks and buy the shares. Here are some expert tips to find and buy stocks at bargain:

How to Select Stocks to Buy at Bargain

Buy Shares at Bargain
  1. If you follow the stock market and related news and updates, find out stocks that other investors are not interested in because of some short-term temporary reason.
  2. If a sector is doing well but some stock within the sector is not doing well and is not favorable to investors, watch those stock. Do some research on them and pick the best ones.
  3. Use the P/E ratio to determine good stocks that are out of favor. Stocks with low P/E ratio  can sometimes signal out of favor stocks.
  4. Pick stocks and study their Price-to-Sales Ratio. Look for stocks that have high Price-to-Sales Ratio in the past but are temporarily low at the current market situation.
  5. Look for stocks that have about 20% or above Earnings Growth and a P/E Ration at about 10. These stocks are worth investing. Sometimes these stocks are overlooked by investors and you can take the opportunity to buy them at bargain price.
  6. Look for stocks that have higher Return on Equity. This data will tell you how much your investment will earn.
Using above tips, investors can easily find good stocks that are out of favor and are worth investing.

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