Smart stock investing is a skill that is not easily learned. If you want to learn to invest your money wisely, be it by investing in the commodities markets or stock picking, you must first develop your own unique style and strategy with which to approach your investment decisions.
Many of the world’s most successful stock investors will back up the theory that states that there is no simple easy way to learn smart stock investing. If there were a winning formula or a strategy that was a sure fire winner then it would soon become consumed by the market and by default become useless.
Smart stock investing can be defined as the skill of being able to pick a stock that is undervalued by the market which it is hoped will increase to its true value once you buy it. Traditional market theory states that markets price a stock on the information available. Therefore by definition smart stock picking involves trying to obtain information about a stock that the market has not yet discovered or considered.
Trying to find out information that the stock markets are unaware of can be a daunting task. However you should not confine your search to needing to find a single piece of financial data or a key ratio you hope the world’s banking analysts have overlooked. Instead you should try to approach your research from a number of different perspectives. Your smart stock investing strategy should not be reliant on a specific formula or defined set of criteria. Instead it should be a collection of best bits form other strategies. You should combine fundamental analysis, ratio analysis, economic/sector analysis with more subjective research such as looking at company cultures, future product lines, advertising strategies.
To summarize, smart stock investing is about finding a varied approach that you can adapt to each specific investment prospect. If you define your strategy to a rigid set of criteria, you will almost certainly limit your chances of success.