1. Stock selection based on economic cycle

2. Stock selection based on company performance

3. Stock selection based on net asset value per share

The net asset value per share, also known as the "gold content" of a stock, is the intrinsic value of the stock. It is the equity that truly belongs to shareholders and exists in physical or cash form in the company's immediate assets. It is the internal driving force behind changes in stock prices. Normally, the net asset value per share must be higher than the face value of each stock, but usually lower than the market price of the stock, as the market price always includes investors' expectations. Under a constant market price, stocks with higher net asset value per share have greater investment value. Therefore, investors should choose stocks with high net asset value per share for investment. If the market price is lower than the net asset value per share, its investment value is extremely high. Of course, stocks with low net asset value and low market value can also be selected appropriately.

Most investors often have a preference for certain stocks, which may be due to familiarity with the company's business, ease of handling the personality of these stocks, or ease of operation, and so on. When selecting stocks based on personal circumstances, one should comprehensively consider their ability to bear financial, risk, psychological, time, knowledge, and other aspects. For example, some stocks often have large fluctuations and unpredictable changes, making them unsuitable for investors with weak resilience in these areas to choose from.

5. Select stocks based on their market performance

The net assets of stocks are the foundation of stock market performance, but the two are not completely corresponding. That is to say, stocks with high net asset values may not necessarily have good market performance, and their market prices may differ significantly from those of the same or similar stocks. Therefore, for short-term investors, how market prices fluctuate, whether their volatility is large or not, and whether their upward potential is broad or not, are also important criteria for stock selection. Generally speaking, short-term traders should choose stocks with significant upward potential or market volatility in the short term, as these stocks offer greater short-term profit opportunities.

6. Select stocks based on their price to earnings ratio

Price to earnings ratio is a comprehensive indicator, from which long-term investors can see the turning point of stock investment, while short-term investors can observe the high and low of stock prices. Generally speaking, stocks with lower P/E ratios should be chosen. But stocks with long-term low P/E ratios may not be worth choosing, as they may be inactive and not favored by most investors, and the market is always determined by public behavior, so their prices are also difficult to climb. There is no absolute standard for what level of P/E ratio stocks are worth choosing. From the current economic development and corporate growth situation in our country, a P/E ratio of around 20 is not considered high.

7. Choose stocks based on whether the stock price has advanced or not