Thousands of companies list their shares on North American stock exchanges. The question is, how can you narrow the playing field and identify the ones best suited to your objectives?
In this article, we'll review a few places where you can start hunting for broad investment themes, then take a look at a few of the key tools and resources to help you identify, monitor and evaluate specific stocks.
Economics and politics: Economic and political trends can have a powerful influence on a company's performance. Every country's economy moves through different cycles, from expansion and growth to contraction and recession. Some companies do better at different stages of that cycle. At the same time, major opportunities or challenges for companies can result from government decisions around taxation, interest rates, privatization, minimum wage laws, and so on.
Demographic and social themes and trends: From the rise of China as a major global economy to the wave of retiring and aging baby boomers in Western countries, big picture themes are creating new markets and new demand for goods and services. In energy, healthcare, technology, and other areas, there are major shifts that could drive growth for companies that provide solutions.
Company announcement and industry trends: Financial results, mergers and product launches—these kind of company announcements can drive share prices in the short term and sometimes over the longer term as well. Bad news can push prices down as investors shed their shares, but good news can boost a company's stock price. As a stock investor, you'll want to keep tabs on the financial media and watch for developments in the industries and sectors that interest you. You may even want to directly monitor specific companies in order to get news as soon as it's released.
Analyst picks: Financial analysts continuously update their lists of stars and dogs—stocks they think are a good buy and others they recommend selling. Their reports provide specific insights and opinions into what companies are doing right, what they're doing wrong, and how that may or may not translate into gains and losses. Analysts aren't always right, but over time you may find some that trust more than others.
Qtrade Direct Investing™ helps you sort through stocks (as well as exchange-traded funds, mutual funds and other securities) to find the ones that are suited to your goals and objectives.
Here are some of the most useful tools and resources:
Tools that allow you to monitor companies you're considering include:
When it comes time to do your due diligence, Qtrade Direct Investing provides extensive fundamental research data. For any company, you can delve into key performance metrics from its most recent financial statements, along with data on its performance history, ratings, and more—everything you need to evaluate the company and compare it to its peer group.