Lately in class we’ve been learning a lot about Finance and buying stocks. For this reason Peter Hodson’s blog “5 qualities to look for in stocks” caught my eye. The buying and selling of stocks is a very risky business, and there’s no such thing as a “ perfect stock”, however, Peter has been able to outline 5 qualities that make some investments better than others. Firstly it’s very important to look at the management/ ownership experience. Say if the CEO has managed to turn around may companies before, it may be good to know when buying stocks. Next Peter highlights the importance of tight control on stocks. If a company you invested in continually keeps selling stocks, that’s probably not a company you want to be involved with. Every new stock they sell is taking a portion of your profit away, and in my eyes that’s not a quality you want in a company. High return on equity is probably one of the most obvious being an investor, and performance in recessions as well. Peter claims that performance in recessions is one of the most important and i definitely agree with this. If a company is able to turn itself around or even increase profits, that’s definitely something to admire. And last is one that doesn’t work for all companies, but is very important to others. If your product is “addictive” it’s going to cause people to desire it more. Also once a product becomes a necessity to many people’s lives, there’s less of a risk of loosing money investing in that stock.  While buying and selling shares may be a risky business, there are definitely key things to take into account before making an investment and I think Peter does a very good job at highlighting them.

Article/ Image :  http://business.financialpost.com/2013/11/15/5-qualities-to-look-for-in-stocks/