How to Predict the Performances of a specific Stock

Ever since the financial market has started many have tried and failed to predict the exact outcome of the market, and up until now there still isn’t a tested formula to predict where the market will lean towards. There are websites, books and online courses that claim to have unlocked the secrets of how the market trends but in reality there is no sure way to do this.

There are two important prices an investor must be critical of, that is the current price and the future selling price. But despite these given facts, investors should also constantly take note of the pricing history this because this will also help in predicting where the market will end up.

Here are a few more tips in helping you predict stock performances

Interest Rates

Changes in the interest rates greatly affect companies. Usually, short-term rates are generally lower than long term rates. A high put-call ratio indicates an over-cautious stance by market participant so there is a much lesser chance of the equity market falling.

Momentum

Plays a big part on where the market is going, when more people invest, the market goes up, encouraging even more people to invest. In a study conducted by Jagadeesh and Titman, they found out that stocks that have performed well in the past few months are more likely to perform stronger in the next month.

By learning how to get an idea of where the stock market is headed, this will greatly affect the chances of a trader making the right positions.