How to Analyze Stocks?

When an investor or a trader steps into the Indian stock market, the very first thought that might appear to his mind is – How to analyze stocks. And undoubtedly, having this thought is completely right as all your trading profits depend on finding the right stock.

Although many people tend to follow a shortcut while finding potential stocks by opting for the broker’s or a stock market advisor’s advice or even following the internet. But, it is never a wise choice. 

So, through this article, we are sharing a few ways to analyze stocks and make a huge profit. The point is, if the right stocks are found out at the right time, you have mined a gold mine. Thus, it makes total sense to learn how to find undervalued stocks. Right?

By understanding these ways, you can choose the right stock that might be beneficial for you and rightly fits under your financial objectives.

Learn How To Analyze Stocks

To learn how to analyze stocks, one must follow certain important ways to improve his/her stock choice. Since all the trading and investment entirely depend on the stocks, securities, or any asset. 

If you have chosen the right stock, then obviously you will be going to receive a huge lucrative profit or amount. However, on the contrary, if you have mistakenly chosen the wrong stock, then you will be receiving a loss in your trading.

If you are a long-term investor then you will be required to follow some crucial ways that can improve your overall trading. Here are some of the ways to analyze a stock:

How to Analyze Stocks for Long-Term Investment?

Fundamental analysis of stocks – Fundamental analysis allows a long-term investor to view the growth of the company by using P/E ratios. The fundamental analysis basically comprises important information related to the company. 

So through this, a long-term investor analyzes the company’s history and understands the stock movement. 

For instance, in the IIFL Markets App, simply click on screeners and choose the fundamental button to screen stocks based on certain fundamental parameters such as:

• growth stocks,
• low and high PE,
• value investing stocks,
• quarterly growers, and
• highest YOY quarterly profit growth, etc.

How to Analyze Stocks for Day Trading?

Now, if you are a short-term investor or majorly choose Intraday trading, then here are some of the ways to choose the stock:

Technical Analysis of stocks – Technical analysis is very important while analyzing the stock.  It is an advanced method followed by charts, patterns, and previous trends.  

Investors who conduct a historical performance of a stock or asset before buying or selling it, quickly understand the stock performance in the future. This helps them to buy the best stock at the appropriate time.

Again taking the example of the IIFL Markets App, you can view advanced chart patterns in different ways. Also, you can easily view the stock movement in previous years. 

You can also opt for the IIFL Markets “Report” which gives you a clear analysis while understanding the stock in each segment- equity, IPO, or choose a strategy to download in-depth reports of a stock.

The Screeners allows you to view different candlestick patterns, and also allows you to perform technical analysis in the bull and bearish condition.

Experts recommendations – Many platforms offer free expert advice to instantly choose a stock. These experts perform comprehensive fundamental analysis along with technical tools to determine the right and profitable stock of your choice. 

In the IIFL Markets App, you can select the “ideas” option that offers a list of some of the profitable stocks that you can buy. 

Other than this, you can choose Smallcases that allow an investor to diversify its portfolio by buying stocks of different segments.

Closing Thoughts

One of the important questions that the majority of the investors and traders ask is “How to analyze stocks” and if you are a long-term investor then it makes total sense for you to go ahead and do some actual raw analysis. 

Most of the trading apps in India offer decent services such as fundamental analysis that allows an investor to understand the company’s historical background to view stock performance in the previous years. 

If you are a long-term investor, you can also opt for specific features such has “Superstars Portfolio” in which you can view a list of the top stock market investors along with top institutions and follow their strategies. 

In case, you need some assistance in figuring how to analyze stocks or need help in anything else related to the stock market, connect with us by filling in your details in the form below: