Tips to Pick Stock

1. Good management and competitive advantage
- Choose qualify companies which are able to make money from its business

2. Average return on equity (ROE)资金回酬 > 15% - The higher the better
- Return generate from the owner’s investment/ shareholder’s return on investment

3. Average earning per share growth rate (EPS GR) > 15% - The higher the better
- Earnings gained for every share

4. Debt to equity ratio (D/E) / Gearing < 0.50 - The lower the better, best is net cash
- Proportion of equity and debt used to finance the assets of the company (company's borrowings)

5. Better profit margin than its peer - The higher the better

6. P/E Ratio - The lower the better
- Price over earning per share

7. Intrinsic value
- Buy if Price < Intrinsic value

8. Fair value
- Buy if Price < Fair value

9. Dividend yield - The higher the better
- Dividend policy - Debt to equity ratio or consistent stable dividend or no fixed policy

Source: summarised from
How To Make Money From Your Stock Investment (Pg.35-80)>>