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The Beginvestor: How to Watch Companies for Investing
Posted on January 8, 2018 by Danielle Bilbruck

This blog is part of a new Stocks for the Week series called The Beginvestor, catered specifically for people who are new to the investing world and want to understand the ins and outs of the market. The Beginvestor is written by Danielle Bilbruck, a novice investor herself, who will be covering her own investing education in detail as she goes and documenting it for this series.

Based on the advice I have read about and relayed to all of you when it comes to a quick-and-dirty how-to on beginner investing, I know it’s important to pick a stock that I both marginally understand and at least marginally care about. I wanted to invest in technology because it’s a sector I mostly understand and it’s a space I feel comfortable in. There are specific names I was hoping to tag for investment opportunities: Amazon, Facebook, definitely not Snapchat, Apple, Microsoft…and all of these companies are doing very well, as indicated by their $100+ stock prices. Yowza. We’re beginner investors here, and I would like to maybe dangle my legs in the shallow end of the pool before I cannonball into 10 feet of water I’m not sure I can swim in. So I looked for something a little more in my price range and came across Intel (INTC) and knew what to do: Buy the stock.

Except I didn’t.

This is where the Stocks for the Week Investor app comes in. While I have been writing for Stocks for the Week for months, I’d never really dug into the Investor app beyond some user testing before its launch. And why would I? I wasn’t investing, so I didn’t have too many reasons to dig in on a company’s safety score and whether I should buy, hold, or sell particular stock. But before I jumped over to the RobinHood app to become the owner of a shiny new Intel stock, I decided it would be worth a look on SFTW Investor first.

It told me to wait.

Right there, in a big yellow square, it told me that my excitement about Intel would have to be pushed out a while longer: HOLD. Part of me, probably the part that occasionally likes to shirk authority, wanted to buy it anyway. My better angels won out and I decided to wait a week or two and see how it did then. I’m glad I did; Intel is now on the “Today’s Recommendations” list on the SFTW Investor app.

But it got me thinking: What other companies might I be interested in down the road and need to watch? So I used the SFTW Investor app to put together two separate watchlists for companies I wanted to keep an eye on in the future. Here’s how I did it:

First, here is the Intel profile that originally told me to hold off. As you can see, today, its recommendation is Buy:

The safety score is 92 out of 100, which I know is a good thing because it’s at least a B+ in high school and definitely an A- on a college rubric. The profile gives me a little snippet about the company, and indicates that I don’t currently have it on a watchlist, but that I can add it to one. I don’t have any clue about what most of these “Fundamental Metrics” are (apparently I have my next blog idea, though) but I do know enough from my investing vocabulary lesson to know what a dividend yield is. I’m not sure that 2.31% is impeccable, but it’s positive, and the safety score is telling me we’re a go. I added Intel to my watchlist, even though I’m buying the stock, because I’d like to see how it changes over the next few weeks…what if it tells me to sell and become a millionaire, after all?

This is the Dashboard, or homepage-style function. Here, you can see all the daily recommendations for stocks to buy. This screenshot is from a couple of days ago, so Intel is not on here, although it is today.

If you scroll down on the Dashboard, you can see where you are able to create a new watchlist, and you’ll also see the overall Sector Safety Scores. These scores are an aggregate of safety scores for the stocks inside that sector, like Technology or Healthcare. As its name implies, it tells you just how high/low-risk or “safe” it is to invest in that sector.

Since Intel is in the technology sector, I wanted to dig a little deeper into that one. Here, I can see the different industries inside the sector: All of the categories that make up Technology stocks available to me. Intel is in the top industry here, as you can see from its profile in the first screenshot. Now, let’s make our watchlist.

If you go to the navigation hamburger icon in the top left, you’ll see a dropdown box to create a watchlist (you can also click “Create Watchlist” from the Dashboard to get to the same place.) That will bring you here. This screen gives us the option to create our own or select a pre-made watchlist. Why not both?

I’ll be candid, I’m not sure what any of these lists mean. I know that “bullish” means that something is on the upswing, while “bearish” means it’s on the downswing, and I know what it means to be high risk…but I know we’re not trading, and I don’t necessarily know what the LC/MC/SC labels mean. So I went with the more self-explanatory one at the top: Popular Stocks.

Ta-da! Here is my new pre-made Popular Stocks watchlist. Here, I can see in the first graph what kind of sectors are in my list. There are 11 stocks in here to watch, and the list shows me the specific stocks, their safety scores, what their last known price-per-stock was, as well as whether I should buy, hold, or sell. Remember, these aren’t necessarily high-performing stocks currently; they’re simply stocks that a lot of people buy.

Next, I’m going to go back to the watchlist creator and make my own.

And here is my first watchlist! As you can see, I started small, with my Intel stock and a couple of others I found interesting. There are only two sectors represented here, but they are what I feel comfortable with for the time being. I can also see that there are three I’m recommended to buy, but one has a safety score that seems questionable. I think I’ll hold off on Xerox (XRX) until I feel a little more comfortable with the investing game.

Just like that, I’ve got stocks to watch. If you’re not quite ready to pull the trigger on buying your first stock, I recommend playing on the SFTW Investor app with watchlists of different companies you find interesting; the app is free and available on iOS and Android, and you can start digging into safety scores of individual stocks, as well as industries and sectors, until you feel more comfortable jumping in!

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Written by Danielle Bilbruck

 
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