Analysis of How Investors Use Ratios to Pick Stocks Using Three Sample Stocks from the Financial Sector

This research displays how investors should analyze and compare stocks using different investing strategies. Previous studies explained the theory behind some of the most popular investing strategies, such as value investing, growth investing, index investing, and momentum investing. Some key information that the studies mention include the P/E ratio, the P/B ratio, the PEG ratio, et cetera. This research uses the analysis of three sample stocks to create a more simple picture for investors on how to pick, evaluate, compare, and rank stocks. The results of the research show that UnitedHealth Group Incorporated has the least risk and is more profitable compared with Bank of America Corporation and JPMorgan Chase and Co. Value investors would be interested in Bank of America and JPMorgan Chase, while momentum investors would consider UnitedHealth Group. Moreover, growth investors and index investors might consider all the stocks, and so on. The research recommends to investors that stocks should only be compared if they come from the same sector, and stocks can be ranked differently based on different aspects.