Introduction
Unearth Long-Term Investment Gems with EquityScan
This guide will equip you with the knowledge and tools to use EquityScan to identify promising long-term investment opportunities. While our platform provides powerful screening and analysis capabilities, remember that it's just the starting point. Thorough due diligence is essential before making any investment decisions.
Why Due Diligence is Crucial
EquityScan helps you narrow down the universe of potential investments, but it's crucial to dig deeper into the companies that make it through your screens. Here's why:
Uncover hidden risks: A stock might appear attractive based on quantitative data, but further research could reveal red flags such as unsustainable debt levels, poor management, or looming legal challenges.
Validate growth prospects: Our projections and analyst estimates offer valuable insights, but it's essential to assess the company's competitive landscape, industry trends, and long-term growth potential for yourself.
Ensure alignment with your goals: Every investor has unique objectives and risk tolerance. Due diligence helps you determine if a potential investment truly aligns with your individual needs and investment strategy.
Let’s get started.
EquityScan Homepage
Filter by Upside Potential
Scan Results
Sort by 'Potential Upside'
Click on Potential Upside: This will sort the results in order of potential upside.
Tailor your search with more filtering options
Want to focus on large-cap companies or dividend-paying stocks? EquityScan's flexible filters empower you to personalize your search. Simply click the filter icon next to the column header you want to refine (e.g., "Market Cap" or "Dividend Yield").
For example, I filtered for companies with a market capitalization of at least $10 billion and a dividend yield of 3% or higher. It narrowed the results to 30 companies.
Experiment with different filters to discover opportunities that match your specific investment criteria.
Stock Detailed View
Click on the ‘Stock name’ to get to the stock detail page.
Fundamental Research
Before you invest, do your homework!
Newsflow: Scan for any recent news that could significantly impact the stock's price. For example, natural disasters, regulatory changes, or industry disruptions can create uncertainty and volatility.
Earnings: Always check the next earnings announcement date. It's generally best to avoid investing in a stock within one week of its earnings release, as the results can cause significant price swings.
Fundamentals: Conduct your own research on the company's financial health and future prospects. Review key metrics, analyze their competitive landscape, and assess their long-term growth potential. Go through our stock market investing course to find out how.
Technical Research
Access advanced charts and technical analysis tools via TradingView (free account allows for two indicators). If you prefer a different charting platform, feel free to use your own charting platform.
Before you proceed, consider these trend checks:
200-Day Moving Average: Is the stock price currently above its 200-day moving average? If not, the longer-term trend may be downward, so proceed with caution.
Short-Term Downtrend: Is the stock in a short-term downtrend? If so, add it to your watchlist and wait for the downtrend to reverse before considering an entry. This helps avoid catching a falling knife!
Dollar Cost Average/Weighting
Dollar-cost averaging is a smart strategy when entering a new stock position, especially when building a long-term portfolio. By investing a fixed amount of money at regular intervals, you average out your purchase price over time, reducing the risk of buying high and selling low. This approach helps mitigate the impact of market volatility and removes the emotional element of trying to time the market perfectly.
Furthermore, it's wise to limit any single stock position to less than 5% of your overall portfolio. This diversification helps manage "unique risk" – the risk associated with a specific company or industry. If a single holding experiences a significant downturn, its impact on your overall portfolio will be limited. Combining dollar-cost averaging with sensible position sizing promotes steady, long-term growth while mitigating potential downside.
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