>> Stock Picks

Stock Picks

There are many places that you will come across stock picks in newspapers, online, from friends and even stock pick services. How do you know that a stock that comes recommended is in fact a good buy?

The key to your success with stock trading is in investing in the right stocks at the right time. Some investors determine which stocks to invest in by doing analysis. There are two types of analysis, fundamental and technical. Fundamental analysis looks at the companies themselves to determine if a stock is a good investment. Technical analysis looks at charts and graphs of stock performance to look for patterns and in an attempt to predict the future of the stock.

Still others rely on stock pick services which are published by experienced investors and stock market experts. A stock pick service alerts subscribers to stocks that are believed to be good buys. Many times, some of the research is done for you. You can also come across stock recommendations from friends and articles in newspapers, magazines and online.

Before you take the advice and invest in the stocks that have come recommended, you can ask yourself a few questions.

How reliable is the source?

In the case of recommendations in articles and online groups, this can be a very legitimate question. If you are unfamiliar with the person recommending the stock picks to you, you can still benefit from the information but only after you do your own research.

If you are receiving stock picks from a newsletter or subscription service, then you already know the background of the person recommending the stocks as this is your prescreened "trusted source". Stock picks that come from a stranger on the other hand need more thorough research.

Does this stock pick come with any research or data to back it up?

While most stock pick services do provide you with research and background on why a stock is a good pick, information you encounter from strangers may not. That's not a reason to discount it entirely; it's just a good idea to look further.

See if third party recommendations come with any reason why they are a good buy. Has the person recommending the stock done research in to the company? Have they had success with the stock themselves? Find out what reason they have for recommending the stock.

Not every stock is a good fit for every portfolio. Even if you trust the recommendation, it is a good idea to do some of your own research in to a company before you make the decision to invest. Follow these simple rules of thumb with regards to stock picks and you should find that you will not be lead astray.

Looking for a good source of stock picks? You should consider a subscription to Crisp Stocks. You'll receive stock charts and commentary along with a detailed evaluation of the stock picks and why they're sure winners.