Definitly the one which is fundamentally strong and ignoring the technical aspects of it.
However, some very easy and rather most safe analysis can be done as
1. 52week high/lows :- go for 52 week high low levels. A stock at its 52 week high level is more prone to go down while a 52 week low stock is more prone to go up. but do read the reasons or why hs it fallen to 52 week low despite this bullish market.
2. P/E ratio against industry P/E
3. Company past growth performace in terms of dividend, Price increase, Bonus and other issues.
The maximum value of your portfolio investment in each share should not be more then 5% of your entire net worth.
Also, your portfolio should not be more then 20% of your entire networth.
I.e. if your networth is say 10 crore then dont invest more then 20% i.e 2 Crore in shares, debentures, mutual funds or capital market altogether. and if you investing 2 crore then dont invest more then 10 lacs in one company..
Why build a portfolio – to avoid huge losses and to avoid loosing all your money at once. Build portfolio based on Stock beta and beta of your portfolio should be less. सारे अंडे एक टोकरी में नहीं रखने चाहिए. अगर टोकरी गिर गयी तोह सारे अंडे एक साथ फूट जायेंगे | दो टोकरी में रखिये ताकि आधे अंडे बचे रहे |
Beta determins you share price movement as compared to Nifty and Sensex. positive beta says your stock movement will be as per market and negative beta is against market. when you invest in both positive and negative beta stocks, then you tend to earn a normal profit with low chancs of loss as any loss will be subtantiated by gains or the fall will be less quick.
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