Tip #1: Always take fundamentals into account when buying shares
Technical analysis does have its place when looking for shares to invest in, but you can’t ignore fundamentals. Fundamentals can reveal the best shares to buy
on the stock market.
So before even thinking about investing in a share, checkout its financial health. This includes looking at cash flow, profit margins and debt.
Tip #2: Never invest in a share that doesn’t treat its shareholders right
The way a company treats its shareholders is very telling. If a share pays out dividends and embarks on share buybacks, chances are it treats its shareholders well. And this means it has its shareholders interests at heart.
If a company rewards its shareholders in this way, check it also has cash flowing in to keep doing this into the future. Dividends and share buybacks are signs of a solid, conservatively run company, Dr David Eifrig in Daily Wealth
When a company focuses on the long-term, it reduces your risks of investing in it.
Tip #3: Buy shares when the time is right
Once you’ve found a company that ticks all the boxes, don’t be too eager to invest. You need to ensure you’re buying at a fair valued price.
You’re looking to buy when a company’s price earnings isn’t through the roof, has ample cash flow and the price is right.
If you think the price is too high, wait. The next time the market has a wobble you should be able to pick it up at the price you want.
So there you have it. Three tips to help you find the best shares to buy.
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