Stock Picking Skills: Four Processes For Screening Stock Selection

One or 30% refers to the total amount of shares held by the institutions that are not less than 30% of the current shares.

stay equity market The most important thing to do is to study the listed companies, but this is an impossible thing for small and medium-sized retail investors. Therefore, only a large number of institutions buy large quantities of stock, which is equivalent to these agencies providing us with a free purchase. Listed company Feasibility report. If we find that there is no shortage of gold fund in the organization, it will undoubtedly increase the reliability of the report.

Two and 40% mean that the average gross profit margin of the listed company in the past 3 years is no less than 40%.

Gross profit margins remain high for a long time, indicating that the company has an obvious competitive advantage in the whole industry. The company is likely to have core technology, strong brand position and strong competition. product pricing right In the market monopoly, and higher gross margin is more conducive to continuous growth of company profits. What needs to be mentioned here is that commercial listed companies are not suitable for the standard of 40% gross margin because of the particularity of their businesses.

Three, 50% refers to the average annual compound growth rate of the company in the last 3 years, not less than 50%.

Microsoft's share price has increased by more than ten thousand times, and SONY's share price has also set a 30 thousand fold increase. DELL's stock price has risen nearly 9000 times in 10 years. Behind these international super big bull stocks, there is a common feature, which is a high average annual compound growth rate. Suning Appliance, a model we can find in the Shanghai and Shenzhen stock markets, has increased by 40 times over the past 3 years, thanks to its compound growth rate of nearly 90% over the past 3 years. It is also necessary to note that we should choose the listed companies with a smaller fluctuation in annual growth rate as possible. If a company has a growth rate of 2 years in the last 3 years, it has a growth rate of over 500% a year, although the annual compound growth rate is over 140%, but the company is not a reasonable choice.

Four, 60% refers to the company's current stock price is not higher than the average cost of the institutional 60%.

We can easily find and calculate the two or 32 items in the above stock selection standard, while the standard one needs to wait until the annual or quarterly reports are released. Most of the time, the price we buy is much higher than the cost of establishing the warehouse. Therefore, I put the upper limit at 60%, so as to reduce the market value of stocks in the next period if half a year's time to screen, although the company that meets the above four criteria of stock selection is poor, but still can find several, of which radio and television express and Shi Ji information are typical. For example, from last year's three quarter report, the broadcasting and television agencies have 35% of the chips in circulation and 32% of the circulation stocks. The average gross profit margin of the broadcasting and television express company has been 51% in recent 3 years, and the average annual gross profit margin of Shiji information has been 54.6% in recent 3 years. The average annual compound growth rate of the recent 3 years is 90%. The average annual growth rate of Shiji information has been 65% per year in recent 3 years. The average cost of the broadcasting and television express agency is about RMB per share, and the closing price before the Spring Festival is higher than the average cost of the institution. The average cost of the organization is about RMB yuan, and the closing price before the Spring Festival is higher than the average cost of the institution.