How to Create Your Own Successful Stock Portfolio
Your mutual fund does not provide the performance of the type you are looking for? You are not alone. According to statistics for the 10-year period from April 30, 1995 to April 30, 2005, 78.6% of active mutual fund managers failed to beat the S & P 500? This means that if you invest in a mutual fund during this time, your fund has only a 20% chance to outperform the S & P 500. These managers are supposed to be so-called experts in the stock market, but they can not even beat the index to measure general marketing conditions The performance
There is an old saying that if you want to do things yourself, this assertion certainly applies to the stock market. As long as you do a bit of research in your spare time, you can create your own portfolio that can thwart the mutual fund's tragic performance and increase your money as you will be proud of
As of May 30 In 2007, the S & P 500 gained more than 42% in five years. It is an average growth rate of 8.4% a year. If you can create a portfolio that you can exceed 8.4% per year, you will not only exceed the S & P 500, but you will also outperform most mutual fund managers. So how do you build your portfolio so that you can fire the mutual funds? Here are some hints:
Tip # 1 – Do not fight for the index. Three general measures of market performance are the Dow Jones Industrial Average, the S & P 500 and the Nasdaq Composite. Look at the one-year charts for these indices. What is the direction of the chart movement? If the index is down, carefully monitor your current position, sell and profit at the appropriate time, do not buy any new positions until the general market picks up. Three out of every four shares follow the overall market trend. Trying to find a winner in a down market is like trying to swim upstream.
Tip # 2 – Changes are essential. The best-performing stocks performed well as a result of price changes. For example, Apple's stock rose more than 50% from a year ago. What happened almost a year ago, and the value of the stock soared? Looking for product changes, changes in financial performance, management changes or changes in the industry.
Tip # 3 – Tell me the money. The company's financial performance is one of the key fundamentals that drives share prices. If the company's sales revenue, net profit and corporate earnings continue to grow at a high rate every quarter and every year, this is a clear sign that you may have a winner in your hand
So make sure you consider this Three Tips If you want to build a portfolio, it will make your mutual fund managers jealous. Doing so will allow you to mutual funds