| Don't know what stocks to buy? Don't know when | | | | Step 2. Narrowing Down Your List |
| to buy them? When buying stocks the first few | | | | Your approved securities list should have a column |
| trades can be intimidating. If you follow just a few | | | | that is either gearing ratio or LVR. The higher the |
| simple steps you can rest easy that you've | | | | LVR or ratio the more the bank is willing to lend you. |
| purchased a lucrative stock. The colossal error most | | | | The higher the percentage the safer the stock. |
| people made during the Global Financial Crisis was | | | | Highlight all stocks over 70%. This should leave you |
| selling their stocks when they started to fall in price. | | | | with around 20 to 40 to pick from. |
| Most Australian stocks are trading now close to what | | | | Step 3. S&P |
| they were preceding the GFC so if you had of held | | | | Next, locate the Standard & Poors listing of stocks |
| them you could be close to where you were back | | | | for your country, in Australia you are looking for S&P |
| when they started to drop. | | | | ASX200, in the USA you are looking for the S&P |
| These steps are going to help you pick stocks that | | | | 500. If any of the stocks on your list are not on this |
| are relatively sound, the companies have the least | | | | list cross them off. In Australia these stocks are |
| risk of bankruptcy but won't provide you with | | | | classified as blue-chip company stocks and are |
| exceptional capital gains, so they are 'safe stocks' | | | | considered the safest to purchase as they are big |
| that over the longer term should provide you with | | | | companies that provide consistent returns. |
| dependable gains. | | | | Step 4. Dividends |
| Step 1. Getting Started | | | | The last step, go through the leftover stocks on |
| It can sometimes be baffling to know where to start | | | | your list, which ones pay dividends? Mark off each |
| when stock picking. The best place to start is by | | | | stock on your list that pays dividends, you may even |
| finding a 'margin lending approved securities list', the | | | | wish to compare which stocks are paying higher |
| easiest way to do this is a Google search. The | | | | dividends as past dividends give an indication as to |
| reason for this is that this is the list of securities | | | | what the future dividends will be. |
| stocks the banks are willing to lend you money for, if | | | | So there you have it 4 simple steps to picking safe |
| the bank is willing to lend you money on these | | | | shares/stocks to purchase. |
| stocks that should indicate the are secure. | | | | |