What does it take to build wealth successfully through stock market investment? If you are a first time investor, there are guidelines you need to follow before deciding on which stock to buy. Even expert investors still go through long research prior to investing. You should do the same. Here are the guidelines for you to follow. 

1. Invest only in companies whose products or services people use often. This will guarantee that the company is successful, and thus is investment worthy.
2. Ensure that the company is in good financial condition. This will ensure the company’s success even in slow periods.
3. Determine if the company has been earning revenues for at least three out of its five years of operation.
4. Know if the company has consistently paid dividends for at least five years.
5. Determine if the company’s dividend yield based on the share price has a yield of at least four percent.

If the company meets all these guidelines, you can be sure that the company is good for investment. Do not just follow your neighbor’s tip or invest in stocks whose brand is familiar to you. Always do your research. There is no room for regret in the stock market. If you must invest your money, invest it wisely.  

This entry was posted on Monday, July 14th, 2008 at 6:43 pm and is filed under Investing Basics. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.