Most Bought Stock Parameters

| June 26, 2014 | 0 Comments

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There are many ways in which an investor can decide on the kind of portfolio he should build. Sources of information can encompass:

  • Advice from friends
  • Recommendations from financial experts
  • Using stock screener tools
  • Using websites
  • Opinion columns written by other investors and financial gurus
  • Using information generated by traders and stock exchanges too.

While there are many indices that such an investor can use, one of the oft used ones is Most Bought Stock. As the term implies, this is a small list of the top 10 or top 20 stocks that have seen the maximum amount of action – buying and selling – in one day or one week and so on.

Details

Almost every important stock exchange in the world and quite a few websites dealing with financial information will give you details pertaining to most bought stocks. By accessing these websites, you can ascertain details on:

  • The name of the stock
  • The symbol of the stock
  • Its logo
  • The last sale
  • The net percentage change and
  • Whether it has been an increase or decrease
  • The share volume

Quite a few times, websites of traders and trading firms will also give you this information depending on what their clients have traded in. So you can take a look at these indices as well.

Relationship with the market

It is indeed interesting to note that data on the most purchased stocks can also give you enough information to correlate with the market performance. Big investors will divulge details on their long equity positions in stocks after every quarter. When it comes to stocks that are publicly traded in US stock exchanges, this information can also help an individual make some correlations and studies on the stocks and market performance.

Historical data will also come in handy to identify the stocks that outperformed the market. You can thus learn by what percentage points they have done better than the markets. You can also learn more about the stocks that have done well and you can also see how traditional favorites of the stock market have fared. It is also a chance to see which companies or stocks emerge as the new favorites of hedge funds, investors and the stock exchanges all over the world.

Many parameters

When assessing the most bought stock, different investors would like to use different parameters. While for some it may simply be a numbers game, for others it could be a combination of aspects such as:

  • Number of shares bought or sold
  • Value of deals bought
  • Number of deals bought
  • Value of deals sold and so on.

Yet others may like to ‘cross reference’ the stocks that have been popular with other information such as market capitalization, turnover, future plans of the company and so on. Plenty of investors use stock screening tools which can generate the names of stocks according to the various parameters that have been set.

Thus, monitoring the performance of stocks and the quantum of trade that has taken place with each of them is a very good idea for it will give individual investors plenty of information to build a better portfolio.

Category: Investment

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