Stock Picking Technique that Works

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Choosing stocks is often like looking for a needle in the haystack. After years of searching through stock lists using the same technique, I decided to go at it a different way.

My usual technique is to look for stocks that are less than a certain price. In the past I tried to narrow it down by looking at top gainer lists.

I started trading on the stock market back in 2001, I used top gainer lists to narrow down my stock picks. Since then, the market and economic times changed.

I remember those days fondly and with excitement. Back in 2001, I choose mostly technology stocks and made a killing. I turned $1000 into over $12 000 in over four months. I was on the phone ever single morning, and I always traded when the market opened, and waited until it closed.




Times have changed and I lost 95% of my portfolio. I began trading with Jetform, now Adobe. It was doing well at the time, and I bought as many shares as I could on $1000.

I watched it carefully, turned it over, made a profit. Then I took the profit and bought a few more shares with another company. Since the stock market was doing well at the time, the economy was good, and the tech market was doing ecstatically, I was on a roll.

I kept going, buying a few more shares each time with the profit. Those were the days. Since then I have been looking to get back to where I was. Its been over a decade now, and I am still trying.

My dream is to live off the stock market. If I knew what I knew now, I'd of been much further along in my life. At the time, I should of taken the money out, and put it into my first real estate venture.

My fears were unfounded. I thought that 50% of my profits went directly to the government in capital gains tax. That's not the way it works.

I learned that if you make for example $5 000 on the stock market and $20 000 from your job, you are taxed on the basis of $25 000. Its calculated on your total income. Unfortunately, I didn't understand this concept soon enough, and I never saw most of the money I made except on paper.

Stupid. Stupid. Stupid. Thinking back, I realize how much of an idiot I was. Well, times have changed, and I am older and wiser now.

After lots of testing, I came up with a new technique. I look for companies that have a current price that is greater than the opening price.

I look at the movement of the stock throughout the day, buy it at a large quantity, (for example, 2000 units of abc company @.30 a share), and sell it off when it reaches my target price, which could be as little as .05. What I have learned is that the best price to buy stock at is .30 cents a share; however, it is allot more risky than buying from a higher priced company.




You need to be extremely careful when buying from small cap companies. Small companies, are trying to expand and get larger, by encouraging people to invest through their activities. It may take them years to accomplish their plans, and to grow the company.

Before I buy, I look at the news, and the stock performance over the last 3 months. This usually gives me a pretty good idea of the risk.

Other factors that you need to consider is the possibility of mergers and acquisitions. When one company goes to buy another company, your shares may be consolidated, depending on the value of the company it is merging with. The same thing can happen when a company is going bankrupt, and the people at the top, decide to change their industry to survive, and keep going.

My new stock picking technique appears to be working. Using this technique I have decided that it may not be good to wait until the end of the trading day to sell.

When you reached your price point, you need to take advantage of it right away. That's all I have to say for now. Good luck.