How To Use A Stock Analysis Tool: Things An Independent Investor Must Know


Do you know what’s the secret of attaining success in the stock market? Well, there is no secret!

Stock analysis tools save time and effort. 

If you want to make profitable investments and gain great returns then you need to make well-informed investment decisions, which is only possible after performing deep stock analysis. The stock market doesn’t work on luck and if you don’t understand the market and make random quick investments, you’ll never be able to succeed in this landscape. 

For those who don’t know, stock analysis is a process of evaluating and examining the company, individual stocks and even the entire market scenario before making any investment. You Can Also Check How to Say Shut Up in Spanish.

While stock market analysis is nearly indispensable for a good investor, the fact can’t be ignored that it is a deep and time-consuming process. It can take days, weeks and even months to study the background of the company, their financial performance and predict their future. And this is exactly where stock analysis tools come in. Thankfully, there are some amazing stock analysis tools available out there. These tools provide you with the detailed market, individual stock and company insights within minutes. When used correctly, stock analysis tools can save your time, efforts while helping you make profitable investments. Let’s know more about these tools and how they work!

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Types of a stock analysis tool

There are many types of stock analysis tools available in the market. Which one to use depends entirely on your investment goals, personal preferences and trading strategies

However, the following are the best and most effective stock research tools :

Stock screeners

Stock screeners are the most popular stock analysis tools that are known to offer the most accurate information about individual stocks. They basically scan the entire market and provide you information on price, market gap, average trade volume, chart patterns and so on. What’s best? You can set your preferred criteria. For instance, you can set your preferences at low-price / high-volume stocks ranging from RS. 200 to 1, 000. The stock screener will display a list of all the stocks that fit the criteria you’ve selected. If you want to know how stock screeners actually work, then check out this amazing stock screener by Tickertape

Charting software

Charting software presents you with the performance of individual stocks, index or fund over a period of time. Charts can either be in the form of candlesticks or linens. Many traders use these charts to decide the right time to buy or sell. 

Stock simulators

Stock simulators or dummy accounts are the tools that allow you to practice your trading strategies without investing your real money. They are best for beginners as they help them in understanding how the stock market works and how they can buy and sell without losing money. 

Trading newsletters

As the name suggests, trading newsletters are expertly designed emails or messages that keep traders updated about the stock prices, market movements, latest innovations and strategies. Investors can subscribe to these newsletters and get daily alerts. 

Now that we have discussed stock analysis or research tools and their types, let’s move on to how you can use one correctly! 

How to use a stock analysis tool? 

As discussed above, there are several types of stock analysis tools available and each works differently. So, it’s fair to say that there is no generalized method of using a stock analysis tool. However, there are some points that should be kept in mind while using any research tool. They are as follows:

Select an easy to use tool 

The very first step is to select a tool that is easy to use and understand. This is especially true when you’re a beginner. There is no point in using a tool that has a very complicated format that can’t be understood. The good thing is, most software provides a free trial, so you can try it out before making the final purchase. Generally, stock screeners work best for beginners. They are super easy to use and provide you with all the information you need to know. When used in conjunction with research, they can be very effective. 

Make sure that your stock analysis tool uses the most up-to-date real-time data

If you’re a frequent investor, having accurate and up-to-date information is very important. Timing is the most important factor in stock marketing. The value of stocks changes in seconds, so it’s crucial to have the most updated information on price, volume, charting pattern and movement. Hence, make sure that your tool provides real-time charting and market streaming. 

Customize your tool

Every analysis tool is different, and so is every trader. Different traders have different strategies, so it’s better to customize your tool according to your investment goals and personal preferences. 

So, these are some of the things every individual trader should keep in mind while using a stock analysis tool. Follow the aforementioned points and make better investments. 

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