As of the end of Sep 2013, there are a total of 782 listed shares in Singapore’s stock market according to the stock exchange operator Singapore Exchange (SGX: S68). While the universe is a lot bigger elsewhere – the USA has at least 4,000 listed companies, for instance – having close to 800 shares to sift through can be a tall order. To avoid being overloaded with information, you’ll need to be able to cut down that universe and find a smaller group of companies to focus on. Here are a few ways to do that: 1) Keep…
While the universe is a lot bigger elsewhere – the USA has at least 4,000 listed companies, for instance – having close to 800 shares to sift through can be a tall order. To avoid being overloaded with information, you’ll need to be able to cut down that universe and find a smaller group of companies to focus on. Here are a few ways to do that:
1) Keep your eyes open
There are investing opportunities in front of us every day. From Breadtalk (SGX: 5DA) making buns in their Breadtalk outlets to Challenger Technologies (SGX: 573) selling your much-sought-after electronic gadgets; from shopping in CapitaMalls Asia’s (SGX: JS8) Westgate retail mall to dining at Soup Restaurant’s (SGX: 5KI) eponymous Soup Restaurant outlets; we can form a list of research targets simply based on the companies we patronise often.
2) Read, read, and read
While you don’t have to read everything, reading business magazines, newspapers, and/or websites can give you some ideas on specific stocks of interest (The Motley Fool Singapore can a nice place to start!).
3) Run a screen
Stock screeners can help you narrow down shares based on certain criteria, such as its valuation ratios, dividend yields, or growth rates, among others. Some free screeners that are available for everyone with a working internet connection include those from Google Finance as well as The Financial Times.
Foolish Bottom Line
By focusing like this, will you end up missing some great shares elsewhere? Of course. Nobody is going to be able to invest in every great share out there. The alternative, though, of not focusing and not doing the proper homework on shares that you buy means you may end up with a portfolio filled with shares that you barely understand and can’t effectively manage – that would hardly seem like a recipe for success at all.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. This article was written by Matt Koppenheffer and first published on fool.com. It has been edited for fool.sg.