Saturday, August 21, 2010

How can I assess the real value of a stock, for buy and hold investing?

I am a beginner and would like to get started in building a portfolio of stocks for long term holding. I have been looking at using America's Finest Companies strategy, and would like some tips on how to assess if the current stock price is good value.How can I assess the real value of a stock, for buy and hold investing?
';Good value'; is a relative term when it comes to stocks, because stock prices rise and fall with the economy. You just have to expect that you will lose some of your money sooner or later. If you can handle that kind of risk, then the next thing you might want to consider is the history of the company that you want to buy into. Is this company ethical? Does it make a profit only seasonally? Is it a green company? What is the history of the CEOs and management practices? What happens when scandal hits or profit margins fall?


And you might want to ask yourself: what is your acceptable risk - high, medium or low? How much are you willing to invest and possibly never see again?


Of course, what you do is all up to you, but research, research, research is by far the best way to go in my opinion. Good luck!
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