In addition to market analysis, conducting a thorough examination of basic fundamentals and upcoming company events is crucial when considering a trade on a selected stock:
Verify that the selected stock or company is not on the verge of reporting quarterly or yearly earnings in the upcoming days or weeks. Holding positions during such reporting periods can significantly increase volatility and risk of losses.
Exercise caution, especially with biotech and drug stocks, as they might be undergoing FDA (Food and Drug Administration) approval processes for their products. Holding such stocks during periods of FDA decisions can result in substantial losses, particularly if approvals are not granted.
Stay informed about the latest news and upcoming company events. Regularly check financial news sites like MarketWatch, Bloomberg, and popular financial websites such as Yahoo Finance and Google Finance.
Explore message boards like StockTwits.com associated with the selected stock, as they can provide insights from the investing community. Obtain information about scheduled company events from the company’s official website.
Utilize popular financial websites and news outlets to stay updated on any developments that may impact the selected stock.
In summary, incorporating basic fundamental analysis into the decision-making process helps traders and investors navigate potential risks associated with earnings reports, FDA approvals, and other company events. Staying well-informed through reliable sources ensures a comprehensive understanding of the stock’s current situation and potential future movements.