I'm not a smart guy, so I dumb things down.1. Do I expect the...

I'm not a smart guy, so I dumb things down.

1. Do I expect the company to survive ? Seems obvious, but it's the most important initial observation.
2. How much cash do they have ?
3. How much debt do they have ?
4. How many employees ?
5. Is their sector hot or soon to be hot (like uranium will be soon) ?
6. Do they have a point of difference ?
7. Learn as much as possible as the management team. Along with point 1 this is arguably the most important.
8. What's their MC ? I prefer companies under $30mil and it's even better when they're not more than $10.
9. How many shares on issue ? I have my own preferences.
10. Finally, I never chase a stock. My average for NZS is 1.4c. Would I be looking at this company now if I didn't own it ? No. And I'm not saying I'd be right, but they're my rules. I'd consider that I'd missed the boat and keep looking for the next one.

I also have a long-term view on most stocks I buy. And I prefer not to hold too many. Unless a stock is 4-5 times up on my average ''buy in'' I won't sell down for profit. I'm after big gains, not pips.

The aim is to become ''free carried'' in any long-term stock.

I'm sure others have more erudite indicators than me, but I use these to try and avoid trouble.