How to Decide which Stock to Buy in Less than 10 minutes

In this time and age where we want everything to be done fast and quick, we want to decide if the stock that we are looking at is worth taking a second look to decide if we should take it further. With a large abundance of stocks being listed on various exchanges and an influx of upcoming Initial Public Offerings (IPO) interests being registered. A company's financial ratios have to be outstanding before investors will take a second look and uncover its hidden assets and be invested in its growth story.

In this article, I am going to share with you how I quickly decide if the stock you are looking at is worth your time to perform an in-depth analysis or if you should let go and move onto another stock instead.

Read: Best Free Mobile Apps for Investing

How I Perform this 10 minute Check

By utilising Investing.com Mobile App available on Android and iOS platform

First, go to Tools followed by Stock Screener

Read: How to Monitor Upcoming IPO's for Free

Select Country, Exchange and Sector to narrow down selection

Add Criteria: Industry, P/E ratio

Why I chose Industry as a criteria is so that the P/E ratio selection that follows will be applicable for the selected industry. The results might be skewed if the industry is not set in place as different industries have different industry P/E ratio.

Next, select the P/E ratio option and narrow the P/E ratio range to the mid mark.

The reason for using the mid-mark as the cut off point is because generally a higher P/E ratio can indicate that the stock is being over-valued. Also, a higher P/E ratio means investors expect higher earnings and it also implies that many are chasing this stock. I personally do not like to chase the stocks that are "hot" or trendy at the moment because I see it as a "bubble" that will burst once the craze is over.

Read: Beating the Street by Peter Lynch

Screener Results are presented

Read: One Up Wall Street by Peter Lynch 

Personally, I will only consider the instruments listed on the main board exchange. In this case, it will be NYSE and NASDAQ and disregard the OTC Markets.

Once the instruments are collated for the different industries, I will input them into my template with more detailed ratios and criteria where I will perform a detailed investigation for each company.

Know of any methods other than the above? Do share with our fellow readers so we can all learn from one another! Feel free to share in the comments section. 

Beating the Street by Peter Lynch

Book Summary on Beating the Street by Peter Lynch with John Rothchild 

This is a follow up reading from One Up Wall Street book summary where Lynch writes about how an ordinary person can also be 'One Up' the Wall Street professionals. 

This book is akin to a diary that Lynch has written about his years spent investing in the markets working with Fidelity. In this book, he shared with readers the hits and misses and shared how he analyses the companies. 

 

Herewith I have extracted the key points from this book. 

One Up Wall Street by Peter Lynch

Book Summary on One Up Wall Street by Peter Lynch

How to Use What You Already Know to Make Money in the Market

For those Time Starved Professionals, I have compiled the list of points which I feel are relevant to the man in the street. Although this book is about navigating the financial markets, it is easy to read as Lynch wrote this with the intention for the everyday people to read. His aim is to show us that understanding the markets is not rocket science, arm yourself with knowledge and be patient. This book aimed at long term investors. If you are here looking for fast gains and strategy play, then this book is not for you.