AUG 31: Online Stock Trading Analysis

by David Jenyns on August 21, 2006

Perform Your Own Analysis

You can find out everything you need to know about a stock and the company that offers it online before you decide which stock to buy or trade. Thankfully, you donít have to be an expert to size up a company or perform what is called an online stock trading analysis.

Thereís no one right way to do this; thereís no ďsystem.Ē By performing an online stock trading analysis, youíre merely looking at a few facts and forming your own opinions about the ďstock worthinessĒ of a particular company.

Iím partial to Imation simply because I looked at a few facts about the company and made a decision to purchase a little stock as I was cutting my teeth on the subject of online stock trading analysis. Nothing grand happened but it was a nice little touch and go action for a few months and I didnít lose my shirt. Since that was the first time I analyzed anything and I didnít lose my shirt, I thought I did pretty well.

First of all, I like to know what the company does or produces. This is the first part of the online stock trading analysis. I may die poor but I just canít get into stock thatís born of a molly screw. There could be a million molly screws sold every day, the stock could be jumping off the charts but since Iím not particularly excited about molly screws, Iíll keep looking. This could cost me a lot of money so Iím not calling this advice.

Ok, so I need to be interested in the company or what they do in order to consider performing an online stock trading analysis on them. Since I like computers and all the whirligigs that come with them I decided to take a look at Imation stock. Imation makes storage devices such as CDs and DVDs to store data, video and music. Since Iím interested in what the company produces, I can perform an unbiased honest analysis to see if I want to jump on the Imation bandwagon.

Analyze This and That

There are many ways online that you can do this. You can read press releases, read the SEC filings, and look at whatís going on at the companyís website. Hereís what I like to do first. I go to MSN which has comprehensive information on stocks, real estate and just about everything money.

Now understand what Iím doing. Iím going to MSN to see the facts about Imation. Itís not a stock pick Iím looking at or anyoneís analysis but my own. That is what makes this fun. You take the facts and essentially draw your own conclusions.

You want to look at more than just the price of the stock or the worth of the company. You want to look at how much if any the profits of the company have grown in the past year. Remember I wanted to be interested in what the company produces and I found that I am. At this point though, while I am looking at all the numbers and trying to make sense of them, I again look at what the company produces and decide whether I think people in general are going to keep being interested.

Now if Imation produced cassette tapes more than they produced anything else, I wouldnít even look at any more numbers. But they donít. They produce CDs DVDs, Flash Drives, in other words storage devices we use every day as a society. This is just one small part of the online stock trading analysis. Since I in my humble opinion decide society as a whole is still interested in those items, I continue to analyze more data about Imation.

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