Investors have access to a lot of tools these days but finding great stocks to buy is still a challenge. Many investors make decisions based on news stories or things their friends recommend. The same names get thrown around so investors end up buying from a very short list of stocks. This can lead to a herd mentality in which some stocks may get overbought and others remain underbought even though they may be outperforming. We're starting to see this on the popular online broker Robinhood.
Most Popular Stocks on Robinhood
Robintrack has the list of most popular stocks on Robinhood. You probably know every symbol on the list if you've been investing for awhile. Investing from a list like this can be dangerous, just look at Delta Airlines (DAL). There are many others that are troublesome.
The Robinhood list is worth watching but investors need to do their own research to optimize their chances of making great investments.
Stock Research is Hard
Finding great ideas can be brutal and researching stocks based on fundamentals and technicals is really challenging for most investors. What metrics should you consider? Do you want growth stocks or value stocks? What about momentum?Large Cap or small cap? What are the important metrics to track for each of these? PE ratios, Price to Sales, EV multiples, Revenue Growth Rates, EPS Estimates, Wall Street Analyst Estimates, etc. How big of a position should take? It gets pretty complicated fast.
We're working on ways to harness the power of data, technology and investment knowledge to help our users make better investment decisions without having to know every company in the market or if a ratio is 2 standard deviations from the norm. And we're trying to make it enjoyable and interesting to do this work.
We do this in 3 ways on EEON:
- Stock Ratings
- Market Intel
- Industry Rankings
Let's start with stock ratings. EEON Stock Ratings provide you with a nice overview of a company based on 6 important investment factors. We'll compare Delta Airlines from the Robinhood Most Popular Stocks list
to Amgen below. It's probably painfully obvious that Amgen is looking much better on most of these factors other than value.
The EEON Stock Ratings are indexing all of the companies in the market based on these 6 factors (Growth, Momentum, Scaleability, Value, Profitability, Safety) and then scoring them on a scale of 0 to 100 with 100 being the most attractive companies.
Amgen for example gets a 70 for Growth so this means that the company is growing faster than 70% of the companies in the market. Delta on the other hand is only growing faster than 9% of the companies. This same logic applies to all of the factors.
The second way that we help you discover new stock ideas is via our Market Intel lists. These lists were created by our internal market professionals and automatically update via algorithms that analyze all market activity and identify the companies that fit a given list like Highest Relative Strength (see below).
These list are great if you want to find companies that are performing well based on the data. You will likely find companies that you haven't heard of but maybe you should.
The final option is our industry explore functionality. Use this if you're interested in getting exposure to a particular industry like say Alcohol because you know that people are drinking more these days. We sort these by market cap so you will find the largest companies by default for a given industry.
As we have described here, finding great investment ideas is tough but we're working hard to give you easier tools that do a lot of the work in the background to provide you with a simpler workflow for finding great investment ideas 💯.
Download the EEON App to open up your investment discovery capabilities!