Perhaps you’ve been reading up on the benefits of investing in the stock market, and you’re ready to take the leap yourself. If you understand the basics, you know that investing is an exciting but complicated journey. There are thousands of stocks to choose from, so you may find yourself feeling at a loss as to which options to select. You’re not alone. Many beginners feel this way. The following will outline a few of the best practices for picking stocks for the first time. 

Decide Your Goals

The first, and one of the most important steps you should take is to decide your portfolio goal. Investors have different criteria, requirements, and risk tolerance based on whether they are working with income, capital preservation, or capital appreciation. 

Having a diverse portfolio is important, so your strategy may include more than one of the above. Once you’ve picked an investor category, your next step if to actually select your stocks, which is where things become a little more complicated. 

Be an Informed Investor

The more informed you are, the better investment decisions you will be able to make. As an informed investor, it’s your job to stay up-to-date on current market events and opinions. Check blogs, magazines, and financial news sites on a regular basis. The internet is a great place to find information because you can find information and analysis from multiple perspectives. 

Pick a Company

One you’ve set goals and become familiar with current events in the market, you’re ready to decide on some companies in which to invest. There are three main ways to find companies that offer the best fit for you. 

The first method is to find ETFs that track the industry’s performance and look at their holdings. Look up the industry’s official ETF page, which will display the top holdings of the fund

Another option is to utilize a screener that filters stocks based on set criteria like industry and sector. Other metrics to sort stocks include dividend yield and market cap. 

You can also continue staying up-to-date with current events and options to generate investment ideas. 

All the time you spend on research will pay off. These are great methods of narrowing down your options and choosing the best stocks for your portfolio. After all, making informed decisions is one of the most important parts of being an investor.