Stock Research
Homework Steps:
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Already know it?...
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THE KEY FACTS:
(quick snapshot... understanding your stock)
100   Stock ticker & Company Profile
110   Anatomy of a Stock - company snapshot
120   What the company does and how it makes its money
130   What Sector & Which Industry?
140   What Competitors?
150   Knowing The Share Price History
160   Knowing Number of Shares Outstanding
     
INTERNAL FACTORS:
(what the company controls)
200   Company Website
220   Annual Report (10K)
230   Latest Quarterly Report (10Q) & Other SEC Filings
240   Conference Calls
250   Earnings Guidance Provided
260   Insider Buying & Selling
270   Stock Splits
275   Secondary Offerings
280   Dividend & Yield
     
EXTERNAL FACTORS:
(what others control)
300   Analyst Ratings & Expectations
310   Major Holders
320   Major Index Membership
330   Short Position
340   News Headlines
350   Industry Events
     
KNOWING YOURSELF:
(what you can control)

400   Your Available Time
410   Age/Risk Tolerance
420   Don't Buy All At Once
430   Diversification
     
CHECK THE EXPERTS:
500   Jim Cramer's 25 Rules for Investing
510   Warren Buffett's Stock Portfolio
520   Business News - TV & Newspapers
530   Business News - Websites
540   Last check: Cramer's latest comments on MadMoneyRecap.com
     
TRADING RESOURCES:
600   Stocks 101: The Basics
610   Online Trading 101 (vs. paying a broker)
620   Anatomy Of A Stock:  The Parts
630   Mad Money Recap
640   Setting up your own free Yahoo! Finance Portfolio
650   Stock/Investing Glossary
     
ADVANCED TOPICS:
(coming soon)

700   Open Step
750   Open Step
790   Open Step
     
FREE HOMEWORK WORKBOOK CHECKLISTS:
800   Ongoing Weekly Homework for each of your stocks
WB   Free Stock Homework Workbook - PDF Download

 

 

 

 

 

 
 

Brand new to stocks?...                                                                             Last updated:      
  600  Stocks 101:  The Basics                                                                                    Share


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Stocks are shares of ownership of a company.     The "stock" or ownership of a publicly-owned business is broken up into "shares of stock," better known as stock "shares." When a private company decides to go "public" to raise more money to invest back into the company, it works with an investment banking firm like Goldman Sachs or Morgan Stanley to create an "initial public offering," better known and discussed commonly as an "IPO."

The IPO sets up several details for the new company's stock, but probably the three most important facts of a new IPO to know are:

                                                 Continued below...

 
 

Sale of stock raises money for a company.   We hear about a lot of IPOs announced for technology companies, and that's a good example to use.  If XYZ Laptops decides that it has a revolutionary new laptop, but it needs funds to properly finance its expansion, it may decide to "go public" with an IPO, selling shares of its stock.

If it decides, for example, to offer 1 million shares, and its IPO pricing is set in the $19-$21 range, and actually sells all of its IPO shares at a set price of $20, it then raises a little less than $20 million to help fund its expansion goals.  It may decide to put that money into new manufacturing or marketing or both, with the intention of growing its business, and increasing the future value of each share of stock as they do so.  This example brings to mind a little company out of Cupertino, California that was once called Apple Computer in 1984, when it launched its personal computer called, "MacIntosh."  Apple, Inc. (symbol "AAPL") is now a diversified computing powerhouse on Wall Street.  By the way, Apple went "public" with its IPO on December 12th, 1980, at just $22 per share.  Today, Apple is trading for more than $200 a share.  This is a great example of increasing shareholder value (and thus, stock price for each share owned) as a company succeeds.

But how do stock prices go up and down?  That's covered in the next section...
 
 
 

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