Whenever the word spreadsheets are mentioned, most people shiver. However they are good stock analyzers. However, it is in fact a reasonably easy method which can be used to get number crunching and getting the answers you need. So make sure you pay attention and get your head around these concepts, because learning to understand them well, will ultimately and literally pay off. Read on.
• Inputs: In order for you to analyze anything, you have to have one to analyze. So pick your self a stock. This can be any stock that is listened at all. So whenever you have you picked a stock which you wish to analyze, you should find their ticker symbol. This is the abbreviation used to identify individual companies. The next thing you need to think about is time period. Just how long do you wish to keep an eye on this bit of stock?view additional hints at http://www.smartstockresearch.com/InvestingBasics/Articles/Stock-Analysis-Spreadsheet.html.
• Prices and Returns: When using spreadsheets as stock analysers, make sure to get price well understood. Once the price for your selected stock is retrieved, you can calculate what your returns could be. To access prices, use any of the well known stock companies. So the price is calculates ascending price today-ending price yesterday. So it is how much in a percentage it’s price has changed. You need to make a formula for that in order to get the answer. So once you do that, you can drag it down and the spreadsheet does the rest.
• Analysis: The important part of a using stock analyzers is analysis. You could find out how much the price of a bit of stock has changed over a certain period of time. This can be done with a line graph. Using this tool, you can understand how the price of the stock has varied over time. This is a gauge of volatility. This allows you to make informed decisions about potential risks involved in that investment.
• Return, Volatility, Risk Adjusted Returns: This is where it can get a little bit heavy, so pay attention. So it will not do to simply add up all of the daily returns over a period of time to get an absolute return. They must be compounded. This is to put interest into the equation. In order to to do this on a spreadsheet you need to use array formulas. You also must consider how much volatility you are willing to put up with. So the more the price goes up and down, the more volatile it is. In a spreadsheet a STDEV function is used to calculate it. In order to see a risk adjusted version, you can divide the stock’s return over its standard variation to see the difference.
Well stock gurus, there you go. All you need to know about using spreadsheets as your preferred method of analysis. It can be complicated to set up but overall it is a worthy candidate for a stock analyzer.