What sort of information should i collect befor start investing in share markit?

Question

i don't know nothing about share investing, what sort of information should i collect before investing in shares.

Answer 1

I would read the following books:

1) The Intelligent Investor

2)Security Analysis (1996)

3) Accounting text book

Answer 2

While choosing a stock, following criteria's need to be analysed for choosing the correct pick

ROCE(Return on Capital Employed)

ROCE = profit after tax + interest earned on investment in long term funds by the company

Higher the ROCE , better is the company.

ROE(Return on Equity)

ROE = Profit After Tax/Shareholder funds.

Higher the ROE, better.

Last 10 years sales growth

Compare the growth percentage with the industry average to figure out if the company is a underperformer or outperformer

Free Cash Flow:

Free Cash Flow = Operational profit - capital expenditure.

Higher the free cash flow, better is the company.

Debt/Equity Ratio

Debt/Equity Ratio = Debt used for business/equity capital used for business

Ratio of > 2 is risky.

Working Capital

Working capital = Cash needed to run daily business.

Higher (Sales/Working capital) is a good sign.

Profit Margins

Net profit Margin = Net Profit/Sales.

Higher margin, better prospect.

Answer 3

There's plenty of resources out there.  I really like How the Market Works.

http://www.howthemarketworks.com/

I've also designed some software to help you do research:

http://stockresearchpro.com

Hope that helps....William

Answer 4

Before investing in shares ask yourself the following question; WHY?   Be very clear on your answers and  what you are trying to achieve, what your appetite for risk is and what return do you expect from your investments? Be aware that it is not for nothing that stocks and shares are affectionately referred to as "shocks and scares". Many people do not understand risk--but invest anyway and then wonder why they just lost all their money? The ownership and trading of directly held shares or equities is not a simple process--consider perhaps the option of starting off by getting into the market via collectives or Unit Trusts. A very good starting point is talk to an experienced IFA and discuss all the options open to you--yes you will have to pay for their advice but time spent at this stage will prove invaluable in the long run! Investing in shares is the way to make returns above and beyond that available from cash accounts--to make money in the medium to long term i.e five years and beyond you have to be in the market. For shorter time horizons, keep your money on deposit.  Good luck and have fun!

Disclaimer:

The answers above are for guidance only and should not be acted upon without you receiving independent financial advice relevant to your circumstances.  To find and IFA please call 0800 085 3250 or go to http://www.unbiased.co.uk.

Answer 5

Your best bet is to set up a dummy portfolio with moneycontrol or investopedia and then start observing how it does.  You will find it useful to read investment ideas and thoughts by gurus like Buffet and definition of financial terms like P/E ,EPS etc.  

Answer 6

If you have a pan card, then you can open a demat and trading account with a broker. Initially, invest a small amount in the market and try to understand the working of the stock market. If you are well versed with the risk and rewards of stock market, then invest with a calculated risk.

http://www.sathiamoorthy.com

Answer 7

First of all you should decide whether you will be a trader or an investor in the market.

If you are an investor then you should be looking at the Fundamental data of the companies to which u want to invest your money in.

If you are a trader, then Technical analysis tutorials will help you.