It’s no doubt that the central goal of every investor is to ensure that they get the best out of their stocks and gain financial freedom. Interestingly enough, there exists a significant difference among stock owners, and this can be traceable to their knowledge of stock investment. This phenomenon is something important for every newbie to consider deeply. We all know that one of the fastest ways to achieve success is to study and learn from people ahead of you, which is what we want to do here today. Presently, we see a new development among investors who are making it big in the stock market. They’re actively investing in some specific stocks.
We might not know everything about how the big guys trade stocks that pay them huge returns in the long run and their choice of playing the game. But we do know that one of their game patterns of purchasing stocks is to go for the ones that are cheap but quality, thus having substantial future growth potential. Recently, some of the big guys in the stock market industry are now doing something that’s important for us to know.
If we understand this, it could be of immense advantage to every one of us when we know the secret behind it. This, anyway, will mean that we can also tap in and follow the big investors, which is a possible way to a profitable investment. So, it’s of utmost importance that we ask the all-important question; why are they buying into these stocks? In this article, we will address the stocks big investors are now buying and how you might possibly benefit from them.
Why Are They Buying The Stocks?
There is a unique stock that one of the legendary investors is buying massively at the moment. Here, we are talking about Warren Buffet. What we know him for is that he has held back from buying stocks and done more stock selling in previous times. But, right now, he’s buying huge stocks of Occidental Petroleum Company. More so, other investors like Cathie Wood, Charlie Munger and Ray Dalio are also buying some stocks, which indicates the possibility of a juicy stream flowing in the direction of those stocks. The facts behind the actions of these great investors are different and can be one or more. Below are some of the reasons behind their buying decisions.
Increased Financial Performance
One of the standard analyses investors do before they decide to purchase a stock is checking a company earning transcript. This is because they can get valuable information that can help them evaluate the performance of these businesses. The better the financial performance, the more the chance of purchasing the stock.
Balance sheet improvement
The ability of a company to elevate or reduce its stock is also a vital factor some of these investors consider before they start buying the stocks. We are talking about debt reduction, common stock equity increment and so on.
Rise In Dividends
Investors also check up on the dividend mark of stocks. Some of these investors are buying stocks because of the chance of future increased margin of dividends.
Another essential factor that drives stock purchase by some of these big investors is the company’s performance. When the improvement is commendable, and there is hope for more, then they want to consider the stock.
Apart from making money, big men in the investment industry also want to save the planet. So, sustainability is one of the underlying factors to make a buying decision for those stocks.
CEO personal attributes
The success of a company most largely depends on the kind of leader controlling it. A competent CEO means hope for company improvement, which encourages the purchase of some of the stocks they buy.
There are many other reasons.
Low Price Relative Company’s Value
Intelligent investors lookout for these a lot, and whenever they get hold of these kinds of stocks with small prices compared to the value of the company, they might buy them because they know it’s just a matter of time before the price goes up.
Big Investors And The Stock They Are Buying
Now that we know the possible reason behind the stocks these successful investors are currently purchasing, let’s take a look at those stocks and the investors that are buying them.
My favorite female investor is … Cathie Wood, I often speak about her
She has recently bought stocks of Coinbase, Twilio and Shopify, which is an eCommerce company for online stores and communication software for businesses, respectively when their price is low.
Another investor, who I do like to follow and talk about is Ray Dalio
When we take a look at the portfolio of this guy, we will see that he bought into Procter and Gamble Co, Pepsi Co, Johnson and Johnson, Alibaba and McDonald’s stocks for one or more of the reasons mentioned beforehand. I can see a lot of security here, but again Alibaba, ….. And another guy who likes Alibaba so much is Charlie Munger.
Recently, this wise investor has bought huge stocks of a Chinese company, Alibaba, with low price to value as his primary drive. He does speak a lot about his investment and he is so confident that Alibaba will bring him a huge return. I personally don’t feel confident in Chinese stocks, not because of China, but because of the business relationships between China and the USA. Not sure how and what will happen, especially with the war RUSSIA AND UKRAINE.
And let’s repeat my favorite guy, the investor that I follow and use his rules is Warren Buffet, he invested a huge amount of money in Occidental Petroleum and Alleghany insurance company. He has been investing heavily in these 2 stocks.
He just bought up to seven billion dollars worth of Occidental Petroleum stocks and also bought Alleghany insurance company.
There you have the stocks the most prominent investors are now buying. Even though each of them has its own style, pattern and principles when it comes to which stock to buy, it’s sure that the end goal of all is to purchase the best shares that bring in the return that secures and grows their wealth. With deep analysis, understanding and choice of investment, you can also decide on which stock is in your best interest of getting you the result you want.
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Recommended books for further reading:
- Intelligent Investor: The Definitive Book on Value Investing – A Book of Practical Counsel
- The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Books. Big Profits
- Stock Market Investing For Beginners: The Investment Guide – How to benefit from the crisis, invest in stocks and generate long-term passive income incl. ETF and Stock Picking Checklist
- Smarter Investing: Simpler Decisions for Better Results
- Investing QuickStart Guide: The Simplified Beginner’s Guide to Successfully Navigating the Stock Market, Growing Your Wealth & Creating a Secure Financial Future
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