What is left for the individual investor?
Selecting the Company
Once one has selected the sector in which to invest, the next question one will have to confront is which company from that sector is the ideal for ones research plans.
This section is dedicated to the analytical tools that security analysts used to do this selection. What the analysts normally do is to first select a company and then, using these analytical tools, to determine the merits in seeks of a possible investment.
For this reason, this section is limited to describe the different categories in which companies may be classified, leaving for later on the examination of concrete techniques. Most investors, being it individuals or professionals waste their time trying to discover companies in growth for then obtaining the securities that they represent.
A growth security is that from a company, whose growing rhythm of sales and benefits due that the important increase in the sales is only significant if it is reflected on the account of results. On the other hand, for this security to deserve such qualification, the growth has to last a certain period of time. I t would not be worth to assign this qualification if the growth is due to isolated facts or to an “accounting correction.”



