What to consider while buying shares

In this video you will find measures that need to be considered before you invest in a share. You should have good knowledge about the company i.e. what products they deal in, what do they manufacture, how many countries they are present in etc. You can look into a good search engine, some good magazines dealing in shares, newspaper articles etc. Then you can look at simple measures like the revenue, net profit, profit after tax etc. of the company. You will find the revenue, profit after tax etc. in the financial statements of the company. Always look at the annual reports of the company. Apart from that if you can get graphs or charts of revenue, net profit then you can compare the current net profit and revenue with the previous years net profit and revenue. The past performance of the company always helps. You can also look at the market capitalization of the company. Market capitalization is calculated by multiplying the current market price with the outstanding shares. By looking into the market capitalization you will get some basic idea about the company's worth. You can consider Earning per share (EPS) which is a measure of profitability and is widely used. You should subtract the preferred dividends with the net income and divide that value with the outstanding shares. This gives the value of each share with respect to the outstanding shares of the company. Outstanding shares are the shares that are held by individual and institutional investors and also comprise of restricted shares issued to the employees. Comparing EPS of similar companies can help in making investment decisions. Considering historical EPS too is a good idea.