Stock Idea

DEFINITION of 'Stock Idea'

A note of suggestion or thinking that initiates the further analysis of a potential investment. Stock ideas can be thought of when news comes across the wire, or when the suggestion is heard from another analyst or investor.

BREAKING DOWN 'Stock Idea'

The main thing to remember when you hear a stock idea is to approach it as objectively as possible and to look at the positives and negatives along with the potential risks. Too often, an investor will take a position on a security based on what someone else said, rather than performing his or her own analysis of the company.

There is no substitute for doing your own homework on a particular firm, and you should never substitute someone else's judgment for your own.

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