Good Stock Investment

www.ProfitableInvestingTips.com – Good Stock Investment What constitutes a good stock investment today? If you follow the actions of legendary investor, Warren Buffett, you jump in when there is a “sale.” Buffet’s Berkshire Hathaway investment group made far and away it largest purchases of stock when the market fell last week. Remember that Buffett is a protégé of Benjamin Graham, who pioneered the concept of intrinsic stock value. Investors like Buffett view a good stock investment as a stock with intrinsic stock value and a margin of safety. Intrinsic stock value is the projected earnings of a company compared to the current rate of return on AAA bonds. A margin of safety can be cash in the bank or unencumbered assets such as property or physical plants. Conservative investors will commonly scout out a good stock investment based upon fundamental analysis of a company’s hard assets and prospects. Then they will wait for a good price opportunity. In this case a good stock investment is a secure stock that holds the promise of forward looking earnings but is, nevertheless, underpriced in the current market. Or, a good stock investment is a stock that is secure and profitable but just took a beating when the entire market collapsed. Although a good stock investment may come as a “tip” from a friend or your stock broker you need to always investigate before buying. This has to do with doing your own fundamental and technical analysis before every buying a stock. Great …