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What strategies do you guys use to invest?
Dopermine-
#1 Posted : Saturday, September 12, 2015 11:13:33 AM
Rank: Hello


Joined: 9/12/2015
Posts: 4
[Strategies]What strategies do you guys use to invest?

I really want to create an android app with will simplify stock picking, I have the basic knowledge of how to do this, but what i really need is some set of working strategies, I recentl created my new one, hoping it would help me gain profit, still testing it out. Found that Centum was a good buy via that set formulae.

So please assist your fellow investor, post your strategies, and I will post the App before Christmas this year, thank you guys.
sparkly
#2 Posted : Saturday, September 12, 2015 1:42:47 PM
Rank: Elder


Joined: 9/23/2009
Posts: 8,083
Location: Enk are Nyirobi
Dopermine- wrote:
I really want to create an android app with will simplify stock picking, I have the basic knowledge of how to do this, but what i really need is some set of working strategies, I recentl created my new one, hoping it would help me gain profit, still testing it out. Found that Centum was a good buy via that set formulae.

So please assist your fellow investor, post your strategies, and I will post the App before Christmas this year, thank you guys.

OMG an android crystal ball Laughing out loudly
Life is short. Live passionately.
philipkigo
#3 Posted : Sunday, September 13, 2015 8:23:57 AM
Rank: Hello


Joined: 2/25/2014
Posts: 7
let me help you with fundamentals, one strategy is to look at the fundamentals and compare for about 6 years consecutively. first calculate the gross profit divided by the total revenue to get the gross profit margin. Cocacola shows a consistent gross profit margin of 60% or better, Moody's 73%, Wrigley Co. 51%.

Troubled United Airlines shows a consistent gross profit margin of 14%, and US steel a not so strong 17%..

As a very general rule companies with a consistent gross profit margin of 40% or better tend to be good stock picks over the long term despite their current share price.

Together with that check out things like high research costs, high selling and administrative costs and interest cost on debt. You do not want any of these above costs to be high. High is quite a relative term but i'll expound on it on another post.

obiero
#4 Posted : Sunday, September 13, 2015 9:27:07 AM
Rank: Elder


Joined: 6/23/2009
Posts: 13,568
Location: nairobi
I look at the PE as a final deciding factor. The start is always EBITDA, EPS. However, you may need to program some form of weighted score on the firm's management, likely a likert scale.. This cannot be overlooked as most stock prices are a factor of information hence a captain that disseminates it well shall aid the share price up. All the best!

COOP 70,000 ABP 15.20; KQ 414,100 ABP 7.92; MTN 23,800 ABP 6.45
philipkigo
#5 Posted : Sunday, September 13, 2015 10:56:01 AM
Rank: Hello


Joined: 2/25/2014
Posts: 7
Something else you should look for is the operating expenses. First lets analyse the selling expenses, general and administration expenses. What to look for is consistency. You don't want companies like GM which goes from spending 28% to 83% of its gross profits on Selling, General and Admin. It only means they are losing money fast enough. If we see a company with SGA close to 100% we are dealing with a company in a highly competitive industry which does not have competitive advantage. There are also companies with low SGA which destroy economics with high research and development cost, capital expenditures and interest expenses. Intel is one example of this. It has perfect SGA but destroys it with high research and development costs. If intel stopped doing research its out of business. Goodyear is another example of capital expenditures and wouldn't remain competitive for long. Stay clear of companies with high SGA or low SGA with high research and development. It means that long term economics are poor even with a low stock price. Bear in mind i am more of a dividends kind of man. Not buy and sell every minute to avoid taxes that come with high frequency of trades.

For capital expenditures and high interest in the Kenyan situation am looking at KQ, i would argue that KQ has poor business mechanics in the long term.
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