When I started out about 3 months ago, I was jumping into trades with no clue. If you go back and look at my first 10 trades, they were all losers. I’m not trading right now because my skill set isn’t where it needs to be. I’ve got a lot more to learn.
My faith in others has been destroyed and I’m relying solely on myself to get rich. Everyone out here has an angle they’re working to get over on people. We let our guard down a little when we think someone is trying to help us out.
The only way to make money day after day trading the stock market is to learn as much as possible. Even if it means looking through boring ass documents.
I’m focusing on company fundamentals right now and that’s lead me to the following websites. Here I can look at company statements and financial information.
SEC Edgar – http://www.sec.gov/edgar/searchedgar/companysearch.html
OTC Markets – http://www.otcmarkets.com
The following document types contain information swing and momentum traders look for when researching companies. Short sellers find a lot of their plays combing through these public records.
10-K – Annual Report (must be audited).
10-Q – Quarterly Report (no audit required).
8K – Company announcement such as a press release.
PRE 14A – Indicates Preliminary Proxy Statement.
DEF 14A – Definitive Proxy Statement.
Proxy Statement = Executive Pay, Merger, etc.
4 – Purchase of insider stock.
S-3 – Registration of securities.
S-8 – Employee stock options.
SC 13G – Purchase of stock greater than 5%.
SC 13D – Activist Investor (new owners, company takeover, etc).
NT 10Q – Late notice to SEC when filing late (bad sign).
You can take it one step further and look up an Accounting Firm using the Public Company Accounting Oversight Board website. It’s possible for shady companies will hire shady Accountants.
By learning more about company fundamentals, I’ll be able to spot stocks that are undervalued. I’d also be nice to find stocks that are trading high, but worthless.
You know those times when it seems like everyone else knew about a certain stock before it blew up except for you? Most people know that stocks are undervalued or pieces of shit weeks or months in advance. Stock promoters and other factors such as news can keep the price of a stock stuck for an extended period of time.
The key is to wait for the price action to dictate the move in your direction. Paying margin interest fees for a stock that holds it’s price for days, weeks or months can be expensive. It’s best to be patient and watch for the right time to get in.
I’m trying to add Edgar into my routine. It’s the perfect tool to use when I suspect a stock is not all that its cracked up to be.
What site(s) do you use to look up company fundamental information?