Undervalued stocks

d712

Hello

Does anyone know of any site that has a reasonably good record for recognising undervalued stocks?

I've looked at sharewise in the past but wanted to give the stocks they've highlighted as being undervalued a significant amount of time to see what happens to them.

That way I can get some impression of how good the site is and make a more informed decision.

Thanks

george4064

There is the Questor share tips. To be honest you shouldn't be making informed decisions based on share tips, you should be making informed decisions by reading company accounts, reports and your perception on the company's management and outlook.

grey_gym_sock

basically, you should ignore all share-tipping sites. there are bound to be some with a good record, but that's just because there are so many of them - purely due to luck, some will do very well, others very badly. then the unlucky ones shut down, the lucky ones keep going, and some new ones start up (which may even be the unlucky tipsters adopting a new name / site). there is no reason to expect the sites with good records to continue to do well.

how should you pick shares, then? the most sensible answer is: don't. instead, make a top-level decision about what markets you want to be invested in (i.e. not just UK shares), and then select funds which give you that exposure - if in doubt, cheap tracker funds. (and if unsure how to make that top-level decision, then go for a multi-asset fund, which does it for you.)

however, it is perfectly possible to buy individual shares and get acceptable results. you need to put in some effort to get a reasonably diversified portfolio. and if you're only going to buy individual UK shares, then you will also need to buy funds to cover shares from the rest of the world. providing you have a 6-figure sum to invest, and you don't buy and sell frequently, then you can keep the costs very low, and expect to get results similar to just using cheap tracker funds - but a bit more variable, because a fund would hold a larger number of shares than you'd buy yourself, so its results would be a bit smoother (not that shares are ever a smooth ride).

but as for beating the market? yes, you can try to - by reading company accounts, etc - but you should assume you'll fail. you are effectively up against professional investors, who have far more time and resources at their disposal - and most of them fail to beat the market anyway. but if you want to try for fun, and you have enough capital to invest to make it viable, and you trade rarely enough to keep your costs low, and you can put up with the greater volatility, then go for it.

AnotherJoe

Undervalued according to who ? And by what criteria ?

The only way of buying something you can objectively say is undervalued would be to buy into an investment trust that was currently selling at a discount, e.g. its constituents are valued more than the shares. And even there there will be a reason, for example quite a few property trusts are running at big discounts at the moment but that will be because people think the property shares underlying will eventually stabilise at that level and then the trusts value will decline to match. If you disagree you can buy them and reap the rewards.

DrSyn

d712 wrote: »

Hello

Does anyone know of any site that has a reasonably good record for recognising undervalued stocks?

No one has a has a crystal ball, not even one that works 70% of the time. If these sites really could do what you are asking, they would not be telling you about it. They would use it to make a fortune for themselves.

I strongly suggest you look at the videos below, before you invest on the stock market.

http://monevator.com/this-former-hedge-fund-manager-reveals-how-you-can-invest-for-life-in-five-quick-videos/

Good luck investing!

d712

Thanks for the responses

I already have a diversified portfolio consisting of a number of index funds but am looking for suggested undervalued stocks that I can then look at in closer detail as a starting point for my own research.

If that research leads to something I think is encouraging then I’ll pursue it further.

At this stage I haven’t seen anything that I think is worth going for.

DrSyn

You have been warned. If you insist you could take a look but it will cost you!

http://www.ukvalueinvestor.com/about/

Thrugelmir

d712 wrote: »

Hello

Does anyone know of any site that has a reasonably good record for recognising undervalued stocks?

I've looked at sharewise in the past but wanted to give the stocks they've highlighted as being undervalued a significant amount of time to see what happens to them.

That way I can get some impression of how good the site is and make a more informed decision.

Thanks

What is undervalued today. Might be overvalued tomorrow. As there's no certainty in business. Share prices can rise without any significant trade as well. As information in the public domain is freely available to all.

Pincher

http://news.bbc.co.uk/1/hi/uk/4507448.stm

Don't forget the classic e-mail scam.

You send 100million people an e-mail that share A will go up,
and another 100million people that B will go up.
When B goes down, and A goes up, you split the first 100million, and tell half that C will go up, and the second half D will go up.
Well, call them under valued, if that's how you see it.

And then charge the believers lots of money for subsequent tips.

george4064

Also, everyone has a different perception of what 'undervalued' actually is.

However the most worrying part is that you are suggesting you consider stocks undervalued when other people tell you its undervalued(!!!!) If that is the case GOOD LUCK, because you're going to need it

d712

george4064 wrote: »

However the most worrying part is that you are suggesting you consider stocks undervalued when other people tell you its undervalued(!!!!) If that is the case GOOD LUCK, because you're to need it

Thanks for the response but if you read my second post again you'll realise that you’re worrying unnecessarily because I did not suggest that at all.