Hey Traders from around the planet. How are you? Today, I just wanted to write an article on a question I get pretty often… ‘How do I choose which stock to trade?
It is a great question. I tend to take a Warren Buffett, Wade Cook type of approach to this question.
1. Trade companies that you know
2. Trade companies that you interact with often
3. Trade companies that you know how they make money
Let’s explain. Let me take a company like Panera Bread, ticker PNRA.
First, do you know of PNRA? Well it might depend on what part of the world you literally live in, but the answer is probably yes.
I don’t know about you, but I’m a giant fatty. I love food. I had Panera about 3 days ago. Therefore, I interact with them quite often.
Third, it’s obvious how PNRA generates revenue.
If we are talking consistency, these 3 keys are huge. Because there will continuously be trading opportunities on companies like Walmart, Best Buy, Apple, Facebook, Microsoft, YUM, PNRA and so on. Regardless if you trade stocks, options or your focus is short term or long term.
And if you want a short ‘fourth’ secret tip, if the stock has average shares of more than 1,000,000 shares – it likely will be optionable and also better to trade consistently.
Personally, my plate as a full time trader can be perfectly full each day focusing on just AMZN, AAPL, GOOGL, FB, TWTR, MSFT, and NFLX. Day trading, swing trading, long term trading using options and or stock on all 3 times frames, these 8 can offer plenty of trading opportunities! Keep in mind, there are literally millions of stocks to choose from. At some point, you really have to be content. In trading, less is always more!
I hope this helps some! Once you have your ‘go to’ consistent companies and stocks to trade, from there it’s all about solid technical analysis, creating your trading plan and following that plan!
Thanks for reading my friends! Until next time, remember, Love Life, Live Life and Trade It!
