There are many methods that you can use in order to pick stocks. Bilal Basrai was ranked as the seventh best stock picker in the health sector by Starmine Monitor and has pointed towards the following methods as being useful for people who have never picked stocks before.
A macro-analysis requires you to be able to see the larger trends in your industry and how they are going to affect each stock that you are thinking about picking. This means you need to take a long term approach to your picking, ensuring that you don’t overpay for stocks when the economy is poor. It is also a good idea to diversify your portfolio when using this method to protect yourself against unexpected outcomes.
This method involves determining what you think a stock is worth to you. This will often not gel with the amount that it is being traded for, with the actual trading price being higher or lower. The simple aspect of this technique is that you simply purchase the stocks that are trading for less than your estimated value, while selling those that are trading for more. However, the value you place on the stock will be subjective and you can’t always guarantee that you will get the returns you want on your picks.
Though Bilal Basrai focused primarily on long term investments over short term trading during his time on Wall Street, he still understands the value in the Technical Analysis method. This involves digging into the price movements in the stock market, particularly those related to a potential pick, allowing you to determine short term trends that can be taken advantage of. This is a technique that is best used by traders, rather than investors.