Home Stock Buying Money Basics Banking Wealth Nature of Rent Economic Theory

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Puts And Calls
What Is Speculation?
Minor Movements In Prices
A Correct Basis For Speculating
What Stocks To Buy
Successful Speculation
Stock Some Terms Explained
When To Buy Stocks
Technical Conditions
Stop Loss Orders

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The Desire To Speculate
Major Movements In Prices
Possibilities Of Profit
Two Kinds Of Traders
Short Selling
What Stocks Not To Buy
The Money Market And Stock Prices
When To Sell Stocks
When Not To Buy Stocks

What Stocks To Buy

In deciding what stocks to buy, it is well to consider first the classes
of stocks, and then what particular stocks you should buy in the classes
you select. We would first of all divide all stocks into two classes,
those listed on the New York Stock Exchange and those not listed on the
New York Stock Exchange. As a rule, it is better to buy stocks listed on
the New York Stock Exchange, although there are frequent exceptions to
this rule.

Then, the stocks listed on the New York Stock Exchange may be divided
into classes, such as railroad stocks, public utility stocks, motor
stocks, tire stocks, oil stocks, copper stocks, gold stocks, and so
forth. At certain times certain stocks are in a much more favorable
condition than at other times. In 1919, when the industrial stocks were
selling at a very high price, the public utility stocks and gold stocks
were selling low, because it was impossible to increase incomes in
proportion to the increase in operating costs. But since the beginning
of 1921, the condition of these two classes of stocks has been improving
and the market has reflected that improvement.

At the time of this writing (early in April, 1922) we are recommending
the stocks of only a very few manufacturing companies; but we are
recommending a number (not all) of the railroad and public utility
stocks, and a few specially selected stocks among the other classes.

In every instance, when you make a selection, you should consider the
company's assets, present earnings, and prospective future earnings, and
then take into consideration all the influences that affect price
movements, as explained in subsequent chapters.

Next: What Stocks Not To Buy

Previous: A Correct Basis For Speculating

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