HOW TO BUY SHARES? - COMPANY SELECTION TIPS
Introduction:
* Welcome friends!. In this post you are get a answer for the question "How to buy a share?". Read the post completely and choose a company to buy a share.
* I hope this will be useful the select a company for your share market investing company.
How to buy a share?
* Many of the people try to invest in the share market by buying the shares of the company when it is low and sell the shares when i t was high.
* Most of share market investing people does not know "how to buy a share". If you don't know to buy share, then follow the four tips in choosing the company to buy shares. The four company selection tips are,
☆ Business Model
☆ Cash Flow
☆ Profit or loss statement
☆ Balance sheet
1.BUSINESS MODEL:
* Your share buying company must have 3 important aspects. The Three important aspects the company must have are,
☆ Low Competition - Your share buying company must have low competitors in the market.
☆ Demand and Supply - Your share buying company must have high demand and also the company should have the ability to supply high volume.
☆ Customer Network - Your share buying company must have at least some customer base for them.
2.CASH FLOW:
* Cash Flow is essential to run a company. Cash Flow means the flow of money in the company.
* Cash Flow tells us the company's income and expenses amount and sources.
* Cash Flow means the way how the company generated their investment. The investment may be from loans or Profit.
* Buy the company share which has high amount of cash flow.
3.PROFIT or LOSS STATEMENT:
* Profit or Loss statement means a statement that includes the income and expense of the company in one financial year.
* Profit or Loss statement is used to know whether the company is in profit or loss state in the financial year.
* If the company's income is greater than its expense then the company has made a profit in the financial year.
* If the company's expense is greater than its income then the company has made a loss in the financial year.
* Buy the company share which has made a profit in the financial year.
4.BALANCE SHEET:
* Balance Sheet is the full record of the company from the starting date to the present date.
* Balance Sheet is used to know the company's income, expense, investment and other financial information.
* Balance Sheet will tell the company's asset and liability. Buy the company share which has more asset than liability.
Share Buying Tips:
* The Three important tips in buying a share are,
☆ No overnight success - Share Market is a long term process, so wait for your profit.
☆ Treat it as a hobby - Don't make share market as a profession, make share market as a hobby.
☆ Always learn about market - Learn about the new and existing company strategies and management etc... .
Conclusion:
* These are important tips for most the people question "How to buy a share". Now you have known the factors involved in buying a share.
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