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How to pick Winning Stock in Buffet Way

This article show you why you must invest in stock market? Why 95% of investor losss money in stock market? How to make money from stock market?

Why must you invest in stock market?

Invest your hard earn money into right type of asset class and equip yourself with investing skills is essential if you want to be financial free. When someone is financially free mean that he or she can choose not to work if he or she wants to since they have sufficient passive income to meet their daily expenses and liabilities.

Dividends and capital gains generating from stock market are great source of passive income that can help you in your pathway to be financially free. Passive income is defined as a type of income you do not need to be actively involved to earn them. This is unlike our earned income such as Bonus, Wages and etc. Earned Income is usually earned base on the number of hours you work. Your earned income is limited by the number of hours we work since we have only twenty four hours per day.

No thanks to inflation. Your saving is depreciating over time if you put all hard earned money into financial institutions alone. For example, Singapore banks saving rate is less than 1% per annual. However, Singapore inflation is around 3% per annual. By not investing your hard earned money, the spending power of your saving is going to depreciate by 2% each year. Over 10 year's period, the spending power of your saving is going down by 20% or more by placing all your savings into financial institutions alone!

In order to beat inflation, you need to invest in the stock market. Investment in Stock can generate much higher return than other type of investment. You need to learn how to pick right stock to maximize your profit.

Some of the criteria to evaluate an individual stock for the potential of good investment return include:

1) Company that are consistently increasing sales and profits,
2) Company with sustainable competitive advantage,
3) Company with future growth drivers,
4) Company with Conservative debts,
5) Company with consistent & high return on equity.

Here is the bad news! Before you venture into stock market investment, you need to equip yourself with proven investing skills. Study show that only 5% of the investors making money from stock market. Another 95% of investors losing money from stock market! To be successful in investing and making money from stock market, you need to model the millionaire investor mindset, learn technical analysis and fundamental analysis and many more.

The good news is that investing skills can be learned. By learning the investments skills from successful investor, you can be top 5% investor who is making good money from stock market! You can consider attend investment workshop or modeling the strategic of successful investor to learn proven investing methods. By modeling the strategic of successful investorPsychology Articles, you can shorten the learning curve and eliminate on costly mistake which result in monetary loss.

You can visit http://www.newbornmillionaire.com/page13.html to learn more about the strategic of successful investor.

Article Tags: From Stock Market, Money From Stock, Stock Market, Investing Skills, Passive Income, From Stock, Earned Income, Money From, Successful Investor

Source: Free Articles from ArticlesFactory.com

ABOUT THE AUTHOR


Article contributed by Nelson Chen. Visit http://www.newbornmillionaire.com/
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