Friday, February 05, 2010

Practice to pick the right stocks

The Pro-Investor is a simulation game that uses a model to generate the earnings per share, price earning ratio of 45 stocks based on the economic trends in various countries, industries and market segment. It aims to give the player the experience of picking the right stocks in this environment.

After many rounds of practice, I found a good strategy to pick the right stocks. Find out the country, industry and market segment that performed well during the previous year. Pick the stocks that from the country, industry and market segment. It is likely to perform better than average during the following year.

The actual trends in each year can be used to pick the stocks for the following year. The stocks that are picked will rotate, but the overall results should be positive.

Will this strategy produce good results in real life? I like to have the data (EPS, PER, Price) for the past 50 years of actual stocks that have lasted for this period, together with a code to indicate their country and industry. If you have the data, you can pass them to me, so that I can use the simulation based on these real data.

If you wish to try Pro-Investor, click here. This game is best played with Internet Explorer 8.

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