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75 Yes/No Questions To Ask Yourself Before Buying A Stock

By Andrew Blackman 

There are lots of good reasons to buy a stock, and plenty of bad ones too. Here’s a checklist of 75 questions you should ask yourself, to make sure you’re buying for the right reasons.

In each case, it’s a simple “yes or no” answer. First we’ll look at some questions you should be able to answer with a confident “yes,” and then we’ll look at some others that should provoke a definite “no.” These of course do not apply to every investment strategy, but should be used as a great reference for what to ask yourself when making stock picks. 

“Yes” Questions:

1. Have you heard of this company before today?

2. Can you explain what the company does in one sentence?

3. Do you understand exactly how it makes money?

4. Do you understand the risks of the investment?

5. Have you analysed the company’s earnings history?

6. Did you understand it?

7. Do you have a clear plan of how long to hold, and when to sell?

8. Have you worked out the value of the company?

9. Do you know how the company is likely to fare if the economy takes a turn for the worse?

10. Have you analysed the firm’s main competitors?