3 Ways to Find Investment Nuggets

 

Searching for great investment opportunities is a lot like prospecting for gold. Not only do you need to know what area will yield the best possible results, but you need to know what has the most potential to give you the abundance of returns you need. Whether you are just starting out with investing or you have been at it for quite some time, prospecting for investment opportunities is something everyone struggles with. Here are three areas you can visit in your prospecting efforts to find ideas where you should invest.

1. Media. Yes, that dreaded “M” word can provide a wealth of information about new and emerging technologies, businesses, and market segments. Magazines like Wired, Entrepreneur and Business Weekly all talk about companies and ideas with great potential. Newspapers like the Wall Street Journal give an indication as to which businesses are performing better than others. Television programs like CNBC, Bloomberg, and others can also provide little clues that, when looked at collectively, can point you in the right direction.

2. Technical Analysis. Most trading platforms allow you to search for relevant technical events. By filtering stocks by the most relevant to your investment criteria (e.g. Head and Shoulders for long-term, Relative Strength Indicators for short term) you can find a safe starting point when it comes to filtering down your search of all potential securities. Of course, all of these securities will need to be investigated further to determine whether they are worthwhile of your hard-earned dollars.

3. Regular Observation. If you are in a larger city or metropolitan area, you can observe some of the growth and expansion that local companies are experiencing. If you see large buildings or plants being erected, there is a good sign that this business need to adapt for growth… adaption makes sense only if there is guaranteed income. As well, if your neighbor or friends work for publicly traded companies, you can determine from their conversations about work whether or not their company is experiencing hardship (they won’t be happy in most cases because their livelihood will be at risk) or growth (almost always happy because along with the extra work and being short-staffed, they are usually compensated for their efforts).

Finding great investment opportunities can be as simple as regular observation or it can be as complicated as filtering securities through an elaborate technical analysis tool. Either way, finding these nuggets is just the start. The next step involves initiating a more detailed investigation and performing a cost-analysis review to see whether the investment is worth making in the first place.

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