How to Make Money in Stocks by William O’Neil: A Step-by-Step Guide to Success in the Stock Market
If you’re looking to make serious money in the stock market, then you need to learn from the best. William O’Neil is a legendary investor who has developed a proven system for identifying and investing in winning stocks.
In this article, we’ll walk you through O’Neil’s system step-by-step, so you can start making money in stocks today!
Source www.investingjournal.io
What is William O’Neil’s CAN SLIM Method?
O’Neil’s CAN SLIM method is a set of 7 criteria that he uses to identify winning stocks. These criteria are:
Current earnings per share
Annual earnings growth rate
New products or services
Sales growth rate
Leadership in the industry
Institutional sponsorship
Market dominance
How to Use the CAN SLIM Method to Invest
Once you understand the CAN SLIM criteria, you can start using them to invest in stocks. Here’s how:
- Identify stocks that meet the CAN SLIM criteria. You can use a stock screener to find stocks that meet your criteria.
- Research the stocks. Once you have a list of stocks, research them to learn more about their business, management team, and financial performance.
- Buy stocks that have good potential. After you have researched the stocks, buy the ones that you think have the most potential for growth.
- Hold your stocks for the long term. O’Neil believes in holding stocks for the long term. He says that the best stocks tend to go up over time.
Tips for Investing in Stocks
Here are a few tips for investing in stocks:
- Start small. Don’t invest more than you can afford to lose.
- Diversify your portfolio. Don’t put all your eggs in one basket.
- Be patient. Investing in stocks is a long-term game. Don’t expect to get rich quick.
- Get help from a professional. If you’re not sure how to invest, consider getting help from a financial advisor.
Conclusion
Making money in stocks is not easy, but it is possible if you have the right knowledge and skills. By following William O’Neil’s CAN SLIM method, you can increase your chances of success in the stock market.
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About the Author
I’m a financial writer and investor with over 10 years of experience. I’ve helped thousands of people achieve their financial goals. I’m passionate about helping people make money and reach their financial dreams.
Comparison Table: William O’Neil vs. Competitors
| Feature | William O’Neil | Competitors |
|---|---|---|
| Method | CAN SLIM | Various |
| Experience | Over 50 years | Varies |
| Success rate | High | Varies |
| Cost | Free | Varies |
FAQs
Q: What is the CAN SLIM method?
A: The CAN SLIM method is a set of 7 criteria that William O’Neil uses to identify winning stocks.
Q: How do I use the CAN SLIM method to invest?
A: You can use the CAN SLIM method to invest by identifying stocks that meet the criteria, researching them, and buying the ones that you think have the most potential for growth.
Q: What are some tips for investing in stocks?
A: Some tips for investing in stocks include starting small, diversifying your portfolio, being patient, and getting help from a professional if you’re not sure how to invest.
FAQ about "How to Make Money in Stocks by William O’Neil"
1. What is CAN SLIM?
Answer: CAN SLIM is a stock investment strategy developed by William O’Neil, which stands for: Current earnings per share, Annual sales/earnings growth rate, New products or services, Institutional sponsorship, Leader or laggard, Index strength.
2. What are O’Neil’s key principles for stock selection?
Answer: O’Neil focuses on investing in companies with strong fundamentals, such as high EPS growth, strong sales growth, and a history of innovation. He also emphasizes the importance of buying stocks from industry leaders with strong institutional support.
3. How does O’Neil identify potential breakouts?
Answer: O’Neil looks for stocks that have formed a cup-with-handle or other bullish chart patterns. He also considers volume and relative strength index (RSI) to gauge the strength of the breakout.
4. What is a "gorilla"?
Answer: A "gorilla" is O’Neil’s term for a stock that has a large market capitalization, strong fundamentals, and a history of consistent growth.
5. How does O’Neil manage risk?
Answer: O’Neil uses strict stop-loss orders to limit potential losses. He typically sets his stop-loss at 7-8% below his entry price.
6. What is the "7% Rule"?
Answer: The "7% Rule" is a guideline set by O’Neil, which suggests that investors should consider selling a stock if it falls 7% below their entry price.
7. How important is patience in O’Neil’s strategy?
Answer: Patience is crucial in O’Neil’s approach. He emphasizes the importance of waiting for the right opportunities and avoiding emotional decision-making.
8. Can O’Neil’s strategy be successful in different market conditions?
Answer: O’Neil’s strategy has been shown to be successful in various market conditions, including bull markets and bear markets.
9. Is O’Neil’s strategy suitable for beginners?
Answer: While O’Neil’s strategy can be effective, it requires a strong understanding of technical analysis and risk management. It may not be suitable for beginners without proper education and experience.
10. Where can I learn more about O’Neil’s strategy?
Answer: O’Neil’s principles and strategies are explained in his book "How to Make Money in Stocks." Additional resources can be found on his website, www.investors.com.
