I've asked myself that question many times, and the answer is simple: the one that grows the most. Putting this into practice is another matter. The first thing you should know as an investor is that your opinions or analyses will always be conditioned by the information you have, and that will always be limited. So don't beat yourself up if your bets go wrong; the analysis might be correct, but the information might not be. As they say, information is power, and insider trading is a crime, but it's what you can profit from the most.
Image AI
Getting back to the stock. Many investors, myself included when I started investing. I'm fairly young, but I've been investing for several years, so I have some experience. As I was saying, many investors tend to look for bargains—undervalued stocks—but this doesn't usually work out very well. If you buy a stock that's worth less than its face value but grows below its potential, the most likely outcome is that its decline will prevent you from making the expected profit. However, if you buy a stock above its value that has strong growth potential, it will quickly surpass your purchase price and offer returns.
So what's the key? Simple to say, but difficult to do. You have to look for stocks with long-term growth potential that are undervalued for some temporary reason.
An example would be a quality company in a boring sector that is increasing its profits but has seen its share price fall because money is migrating to more fashionable stocks, such as technology companies linked to AI.
But when in doubt, always choose companies with future growth potential. Otherwise, you'll get stuck just like them.
Disclaimer.
This is not a purchase recommendation. I am not a regulated financial analyst. Under no circumstances should this information be construed as a recommendation to buy, sell, or hold a position.
You should be aware of the risks involved in investing and conduct your due research.
The information described here may not be accurate or may change at any time, so you should always check it.
