What would be the top most priority to look for, before we choose a company to invest?

Question

danielle · Answer

syatematic risk of the stock and its contribution to the risk of the portfolio + whether the stock is undervalued or overvalued. So you need to look at two dimensions risk and return

anonymous · Answer

hmm.. Risk and return is a wonderfully compact answer. If we go little in detail, it would mean Volatility of the stock for RISK and the profitability and valuation of stock for Returns. right?

anonymous · Answer

Well, risk. Is it going to fail? Is it going to flourish? Profits? Trust of company? the investing is a gamble: priority is risk and gamble

danielle · Answer

risk is beta which is the systematic risk (i.e how your stock covaries with the market) and return is the price appreciation + dividends that you receive from the stock for a given period.

anonymous · Answer

There is not statistical evidence that the beta is related to the profitability of any stock in the market. Apple has a beta of 1.23, RIM has a beta of 1.73 according to Google Finance. You should pay attention to the fundamentals revenue, operating margins, growth opportunities

anonymous · Answer

ya beta alone is not enough. Returns and Growth opportunities are to be reviewed

anonymous · Answer

i agree with it

anonymous · Answer

http://aswathdamodaran.blogspot.in/2012/06/passive-value-investing-screening-for.html