The concept of “stock picks” distracts investors from realistic risk, reward, and execution level management required for consistently positive returns. To achieve success in the investment business model, potential shareholders must have realistic entry and exit plans of positive statistical expectancy.
The idea hints that anyone could go from rags to riches by investing in the alleged “right stock”. With no need for precision in entries, exits, risk management, potential reward estimates, supply and demand figures, etc., it sounds effortless to just buy and hold. The typical uninformed crowd likes “easy money”, or uncomplicated, stress-free ways of making some extra income.
As the above sway retail investors into a dream of riches gained easily and quickly, it does not usually end well. With every consecutive bullish time frame, the average investor becomes more forgetful of past volatile declines and becomes bolder with purchasing. The often late buying of increasingly uncertain stocks then naturally leads to negative returns for the majority. The typically pushed buy and hold scheme carries many inherent risks.
Like any business commodity, the prices of listed stocks move with respect to underlying shifts in supply and demand. Near the end of each rallied period, demand lowers thus offering a lower probability of continued increase for the subsequent time frame. The downturns or slowdowns frequently occur due to profit taking from institutional trading, lowering demand and increasing supply.
As the stock markets largely hold a positive correlation with the underlying economy and indexes, “stock picks” becomes irrelevant as they mostly move in the same direction concurrently. A few bad apples get out of shape and drop dead sooner than later, but the rest move with the general Dow Jones or S&P 500 and very rarely grow at significantly higher speeds.
It then makes more sense to study sentiment values, supply and demand swings of the economy and stock indexes. Initiated buy orders tend to raise prices and vice versa. Liquidity and opinions of institutional traders matter. This roughly explains the semi-mean reverting nature, i.e. the zigzag price action of the financial markets, and why it generally concurs with economic cycles.
With every industry, a few informed, innovative business leaders get the cake while the rest take shots in the dark and barely survive. Consistent success in adequate investment returns requires proper, relevant information and connecting unseen dots. Specifically, adeptness in statistical analysis and general business administration contribute greatly.
The financial markets principally offer a price database of astronomical proportions. To analyze and unearth significant findings effectively, investors would do well to acquire an education in statistical and probabilistic mathematics. This approach takes work, and it has helped diligent investors find market inefficiencies, where practical and steady profits become available.
Stock investing functions like any other business, where it requires realistic and comprehensive plans of execution. Seasoned investors embrace concise risk and reward management schemes, then create appropriate designs of action. With clear cut strategies for both entries and exits to exploiting found statistical edges; winning will not rely on luck, but becomes destined (regardless of the stocks traded).
As an investor, getting into the right stock market is a very essential step. You need to ensure that your market is one that can keep up with the test of time; that is, remain consistent no matter what. When it comes to the world of mutual funds, consistency is one of the rarest qualities you can find. Just like the managers come and go, so does the market-beating performance. But there are some stocks that are of rare exceptions and these ones are noted to be the best. Therefore, we have made the best stock picks that are bound to turn out as successful investments now and overtime. Invest in our best stock picks and you'll have a higher chance of coming out ahead too.
Our number one best stock pick is no other than the owner of Google. Alphabet has a market value of 552 billion dollars, therefore it is hard to imagine it getting much bigger. But the thing is, the owner of YouTube, Google, and a lot of other tech business hasn't peaked yet. The company is an innovative one as such continues to create more innovative opportunities. Some of its recent product launches includes a virtual personal assistant known as Google Home, and the Pixel Smartphones. Add these products to the wide range of products Alphabet already has including the thriving sale of cloud based services, ads, and apps, and you get a solid company that a lot of analysts have the belief that will generate a twenty percent growth in profit in 2017. The stock doesn't look much expensive given the fact that 27 times estimated earnings will be generated.
· Annual Revenues - 85.5 billion dollars
· 52 - week high - 839 dollars
· 52 -week low - 672.66 dollars
· Projected Earnings growth in 2017 - 20%
Back in October 2016, Amazon.com took a hit as the earnings they realized was below expectations. But thanks to proper and solid management, the company, which is arguably the biggest e-commerce company in the world, is back on its feet with its eyes on the long term. The giant online retailing company is not just into e-commerce, it has also found a strong foothold in cloud computing, and they are not stopping there either. Amazon is moving aggressively into artificial intelligence and video content, not to mention delivery of drones. As seen by Value Line, the company is expected to get a 19.5% increase in revenues annually over the course of the next five years.
· Annual Revenue - 128 billion dollars
· 52 - week high - 847.21 dollars
· 52 - week low- 474 dollars
· Projected Earnings growth in 2017 - 93%
The third company in our best stock pick is the CME Group, owner of the Chicago Mercantile Exchange. The group also owns other trading centers where speculators bet on almost anything, from the price of pork bellies to the grand/future level of Standard and Poor's 500-stock index. By providing more services to traders and merging with other exchangers, CME has been able to undergo a significant form of expansion.
CME pays a regular dividend of sixty cents per share, and as estimated by Bank of America's Merrill Lynch in 2016, the group was expected to pay a special dividend at the end of the year, which will in turn make the total payout 5.67 dollars a share in the year 2017, providing the stock with a nice and heavy 5.1% yield.
· Annual Revenues - 3.5 billion dollars
· 52 week high - 122.74 dollars
· 52 - week low - 81.67 dollars
· Projected Earnings growth in 2017 - 10%
Serving as one of the fastest growing companies right now, salesforce.com deals with the selling of web-based software that enhances the relationship between customers and business owners. The company is pushing forward and broadening its product lineup by diving into other areas such as digital marketing and data analytics. Salesforce is not just stopping there, the company is fueling its expansion by making acquisitions such as a recent deal involving Demandware. Salesforce recently made a deal to purchase the e-commerce company for 2.8 billion dollars.
According to technology analyst, Terry Tillman, and Raymond James, Salesforce revenue was expected to rise by 25% in the fiscal where which ended January 31 of this year, and expected to have a 21% increase by the end of the next fiscal year.
· Annual Revenues - 7.9 billion dollars
· 52 -week high - 84.48 dollars
· 52 - week low - 52.60 dollars
· Projected fiscals growth earnings in 2018 - 109%
Crown Castle International, or CCI, is a real estate investment trust that leases nearly forty thousand cell-phone towers to wireless network providers such as Verizon and AT & T. As long as consumers consume data on their mobile devices, CCI keeps making its income. AS a REIT, CCI must be able to shell out at least ninety percent of its taxable income to investors. The stock will yield 4.4% as a share is being sold for 3.80 dollars.
· Annual Revenues - 3.8 billion dollars
· 52 - week high - 102.82 dollars
· 52 - week low - 75.71 dollarsProject earnings growth in 2017 - 6.5%