Frank Curzio's tips for solid returns in the stock market

Frank Curzio is one of the most respected stock and digital securities experts. His passion for the markets comes from his father from whom he learned the tricks of the trade. His father, Frank Curzio Sr., was a portfolio manager and award-winning investment newsletter publisher.
Curzio went on to develop a world-class track record of uncovering the best small and mid-cap stock ideas for one of the richest hedge fund managers on Wall Street.
Today, Curzio is best known as CEO of Curzio Research and host of the widely popular Wall Street Unplugged podcast.

Curzio often shares his investment wisdom in his podcasts which helps investors avoid mistakes and achieve investment success. Let's look at some of these investment tips shared by Curzio.

Curzio says investors should use only a small part of their funds for speculation purposes with preferably only 30% in aggressive situations.
"Invest a little to make a lot, and not a lot to make a little," he says.

Curzio says there is always a risk involved in trading of securities and there are always chances of even the most prestigious and highest rated ‘A’ securities succumbing to temporary devastating plunges.
Hence investors should note that if a stock drops 50%, given time it may come back and may trade over the original cost.

Curzio says investors who purchase stocks immediately after glowing earnings reports or optimistic press releases often result in buying at the top.
Hence, investors should understand that the best buying opportunities usually prevail when a company reports lower earnings and when adverse economic news is widespread.

Curzio says investors should look for companies which are audited by best accounting firms so that reliable info about the company can be studied."Big and reliable accounting firms audit about 90% of the companies listed on the New York Stock Exchange (NYSE). There are over 10,000 public corporations trading on the various stock exchanges and in the over-the-counter markets. One of the leading reasons why investors lose money is due to financial statements that are not prepared in accordance with regulations. If the figures are incorrect, your investment in the stock is subjected to substantial or complete loss," he said.

Curzio says fund managers should pay close attention to credit rating from big rating agencies such as S&P and Moody’s as positive credit ratings ultimately result in higher quotes due to additional money available for investment in these stocks.
"Decrease in ratings usually result in lower stock quotes," he says.

Curzio says the institutional funds represent approximately 80% of all money in the US market. The managers of these funds must answer to their shareholders and superiors and are required to issue quarterly reports to their respective shareholders.Curzio says stocks which are down or close to their yearly lows, are usually sold by the institutions near the end of the quarter so they don't show as holdings in the quarterly report, causing even lower stock quotes. And stocks near their highs are purchased, thus enforcing higher quotes."If you choose to purchase a stock because it is low, wait until after the end of the quarter. Chances are, it will be trading lower. Of course, there is no guarantee the stock will not trade even lower in the upcoming quarter. If you are going to bottom-fish, be patient. Or, if you want to sell a stock that is trading near its high, chances are it will be higher just before the quarter ends," he says.
(Disclaimer: This article is based on Frank Curzio's podcast for a financial website)