What are the ideas and reference indicators for looking for small and beautiful stocks? Can novice players use petty cash to "test" when they just learn to speculate?

What is small and beautiful stock

"Small" means that the total market value and circulating market value of stocks are small. It is relative to the traditional large cap white horse stocks. Generally, we think that stocks with a total market value of less than 10 billion and a circulating market value of less than 3 billion can be regarded as small cap stocks. Generally speaking, after a long time of listing, most of the shares have been lifted. If there is no stock freeze due to additional issues, the total market value and current market value should be the same.

"United States" refers to the good investment prospects of stocks. Generally, we can consider these aspects: price earnings ratio (PE), price to book ratio (PB), market share, product dynamic sales rate, revenue growth, growth of non net profit deduction, gross margin, net interest rate, return on equity (ROE), asset turnover, etc.

Why Small and Beautiful Stocks are Suitable for Novice

When novice players are just learning to speculate in stocks, they usually use petty cash to "test the market", which can not only experience the real market operation, but also avoid large losses. Small and beautiful stocks are generally easy to attract the attention of the main funds, and the transactions are active and volatile. Unlike the traditional large market white horse stocks, there is often a large amount of institutional funds. Either the stock price of Guizhou Moutai is too high, or oil stocks and bank stocks need huge amounts of funds to promote. As long as the small and beautiful stocks are properly operated, both short-term and long-term holding can achieve better returns.

How to find small and beautiful stocks

When considering "small", we should try our best to choose stocks with small circulating market value. With the same size of capital inflow and outflow, such stocks will have greater volatility. Generally speaking, there are more small cap stocks listed on the GEM; The circulating market value of secondary new shares is generally smaller than that of "old shares"; There is also a class of "old stocks" with small total market value and circulating market value, which should be paid special attention to whether they are junk stocks that have lost money in consecutive years, stepped on thunder or have another risk of explosion.

From the perspective of "beauty", we can give priority to stocks with low P/E ratio, but we should pay attention to whether the low P/E ratio is caused by high financial leverage; When selecting stocks with high P/B ratio, it depends on whether they are asset heavy or asset light industries; High market share and high product dynamic sales rate indicate that the company has a high market position. High revenue growth and non net profit deduction growth reflect the company's good operating conditions. High gross profit rate indicates strong product competitiveness. High net profit indicates low production costs. The higher the ROE, the better. Try to choose companies with ROE above 25%. High asset turnover rate indicates high utilization of funds.

The above are the ideas and reference indicators for finding small and beautiful stocks. The relevant data can basically be found in the stock operation interface. If there is a basis, you can also refer to the company's regular announcements and research reports of securities companies. I hope it can help you.

key word: Small and beautiful stocks Novice Circulation market value