The Art of Investing in Equity


There are a multitude of investment options in today’s financial world. However, equities still remain one of the most profitable ways to invest your money. As surprising as it may sound, the fact is that a large number of investors have no shares in their investment portfolio. It can be for a variety of reasons. The main reason cited by many is that they simply do not know how to pick a good share. Picking a good share at a good time is the key to success in the share market. There is no reason though that you cannot turn yourself in to a seasoned investor yet!

Reversed fortunes:

Companies are just like people. Sometimes they go through a rough patch and sometimes they get a break. Listed companies lead a very public life, so keep your eyes and ears open and you will know when a company’s fortune is headed for an about turn. Read the balance sheets while doing your research. If you find that the company’s losses are declining steadily and it is showing consistent signs of improvement, you may consider purchasing the shares of such a company. Do not be swayed by sudden changes, as it could be detrimental.

Mergers and Acquisitions:

The economies of scale, better synergies etc. are all the buzzwords you hear around a merger. It is true that mergers do create new opportunities for investors. During mergers investors are provided with a chance to get more value and often after the merger better administration of the company does provide good results.

International factors:

Just consider the rising cost of fossil fuels and petroleum products. This is an international trend that has an implication on several industries. As an example, the airline industry suffers from the rising cost of aviation fuel but at the same time oil retailing companies the world over make a steady profit. Keeping a sharp eye on the global trends today is a necessity if you want to invest in the stock markets. It may help you pick up better stocks in this global economy.

The government and its role:

The government plays a vital role in the economy. It is a regulator, investor and owner and has many more diverse roles. One of the most important roles of the government is policy making. A government’s policies can have a beneficial or an adverse impact on an industry. Keep following the latest on what is happening on this front and you are already a wise investor.

Eureka, I have found it!:

Innovations fuel growth. Just consider Apple computers and the iPod. Apple was down in the doldrums not that long ago and the innovation of an easy to use and trendy music player changed its fortunes. People who recognized the company’s streak for new innovations and held on the stock were richly rewarded. There are similar stories closer to home. Investing your money in an innovative company or a company that follows the latest trends may be one wise way to invest your money.

Beyond the horizon:

Looking further has always been one the most fundamental keys to successful investment in stocks. If you are able to think not just about how a company is doing now but also how it will fare in the future, you will emerge a sure winner. Putting your money in shares is just about analyzing existing information and using your intuition and perception to try and gauge the future. An informed investor is a happy investor. Take notice of all the tiny details and you will see how they are all connected. So put some time aside and try to pick a stock now for your future. Chances are you will not be disappointed.