Ep 106 - Top 5 Warning Signs of a Stock in Trouble
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Description
Here's something you really need to know: You can be the best stock-picker in the world, but still lose money if you fail to monitor your own portfolio for any signs of trouble.  If you are managing your own portfolio, then you should always look for signs of deterioration in terms of the performance of the stock that you own. And NO, I don't mean looking at the share price. When I first started, I thought the easiest way to do this is to look at the company's earnings per share (EPS), but that's not enough. Why? Because a company's earnings can be manipulated.  A good example would be WorldCom.  Not only was this the biggest accounting scandal in the history of the United States, but it was also one of the biggest bankruptcies of all time. So what actually happened? Well..at one point in time, WorldCom was valued at more than $100 billion. Problems started when the managers decided to support the company's share price during an industry downturn by booking billions of dollars of earnings that came out of nowhere. When Shareholders started noticing these accounting irregularities, those who sold early lost some money, but those who waited until two years later when the full extent of the accounting fraud was revealed, they lost everything.  That is why it's so important to always keep track of your stocks in your portfolio and in today's episode, I going to go through a few metrics to use in order to detect whether a company is in trouble. So, check out this episode to find out more! For more info about Delugne Investing, check out Delugne.com to find out more!
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