First of all.
We are pleased to provide an original report, 'A must-see for beginners! moomoo App Complete Strategy Report', created by the moomoo Securities editing department, to everyone who has opened an account with moomoo Securities.
In this report, we created it with the intention of using the 'moomoo App,' the strongest trading and analysis app for individual investors provided by moomoo Securities, for individual investors to trade smoothly and analyze professionally. With this manual, even stock market beginners can easily trade and perform professional level analysis.
Before getting into the main content, let us briefly introduce the structure of this report. First, in 'What is the moomoo App?' we explain what kind of app the moomoo App is. Please deepen your understanding of the moomoo App here and move on to 'Recommended Features for Beginners.'
In 'Recommended features for beginners,' we explain the features of the moomoo App that we would like beginners to use with screenshots of the app. We recommend only the features you need in order to make it easier to use the app, so let's get used to operating the app while reading this report.
Finally, we introduce you to 'Papertrading' operation method. Papertrading is a function that allows you to simulate stock investment using fictitious funds. I think many people feel that the hurdle to investing their own money is high, so let's learn the feeling of stock investment by using Papertrading.
When you first start investing in stocks, there are so many things you don't know. In this report, we explain the operation method carefully using screenshots of the app, and we also explain the terms that appear in the app, so please feel free to come back to this manual whenever you are lost about how to use the app.
Well then, let's learn together to master the moomoo App!
Table of Contents
First of all
1. What is the moomoo app?
2. Recommended features for beginners
2.1. ①Explore stocks
2.1.1. Explore stocks from "themes"
2.1.2. Explore stocks from "High Dividend Rankings"
2.1.3. Explore stocks from "Shareholder Benefits"
2.2. ②Deepen your understanding of individual stocks
2.2.1. ①Yoshiho
2.2.2. ②Company Valuation
2.2.3. ③Profit and Loss Statement
2.2.4. ④Financial Indicators
2.2.5. ⑤Dividends
2.3. ③Get financial statement information
2.3.1. In some companies, the number of automobiles sold or gaming units sold can be confirmed
2.3.2. More detailed financial information is available for US stocks
2.4. ④Get used to stock investing with papertrading
2.4.1. How to papertrade (purchase edition)
2.4.2. How to papertrade (selling edition)
3. Finally
1. What is moomoo app?
Moomoo app is a powerful trading and analysis app for individual investors provided free of charge by Moomoo Securities! You can use fundamental analysis using income statements and cash flow statements, liquidity analysis using trading information and short selling information by investor size, and technical analysis using technical indicators. The great charm of the moomoo app is that you can triangulate stocks from three perspectives: fundamental analysis, liquidity analysis, and technical analysis.
Until this app appeared, it was necessary to go to the company's IR page for fundamental analysis, view the securities report for Japanese companies and Form10-K for U.S. companies, and aggregate the numbers in Excel. For liquidity analysis, you had to check a dedicated site, and for technical analysis, you had to use a dedicated tool. However, with the moomoo app, you don't have to go through the hassle of combining multiple information sources to make investment decisions! The great appeal is that investment decisions can be made with one app and just five minutes, greatly reducing time.
The moomoo app is packed with many features, from beginner-friendly features to advanced features for intermediate and higher-level investors. If you can master this app, anyone can do professional-level analysis. However, using advanced features right from the start can be difficult, so this report will focus on beginner-friendly features. Please read through in order.
2. Recommended features for beginners
Introducing the recommended features for beginners on the moomoo app. This time, instead of simply introducing the features, we will explain them along with four challenges that beginners should take on to get used to stock investing.
2.1. Discover stocks
One way to discover stocks to invest in is called screening. This method combines various indicators related to stock investment (such as PER, PBR, and operating profit margin) to create the conditions you want to invest in and identify stocks that meet those conditions.
However, it is difficult for beginners to screen using indicators right away. Therefore, methods of finding stocks from the perspective of "themes", "high dividend rankings", and "shareholder benefits" are recommended. We will explain what kind of stocks can be found for each.
2.1.1. Discover stocks from "themes"
On the moomoo app, stocks are listed by theme, such as "strong yen", "rising interest rates", and "AI data center". It is recommended to check the stocks included in the theme that you are interested in or that resonate with you.
<gainianbankuai>
For example, let's say that you are interested in the theme of "rising interest rates." When you tap this theme, related stocks are listed as shown in the image below.
<kinrijo_shoukan_kanren_meigara>
It was found that Mitsubishi UFJ Financial Group, Japan Post, Fukuoka Financial Group, and others are related stocks for the rise in interest rates. If there are any stocks that you are interested in, let's tap the stock name. A page with summarized information necessary for investment decisions, such as the stock price chart and financial statements, is displayed.
<kobetsu_meigara_no_jouhou_peji>
Additionally, this page contains various information ranging from beginner to intermediate levels. Since it is difficult to make full use of all the information from the beginning, we will explain the recommended functions for beginners later.
Moreover, it is recommended to tap the "♡" on the right side of the stock you are interested in.
<kininaru_meigara>
When you tap the "♡", it is registered as a favorite stock and displayed on the top page (watchlist tab) of the moomoo app. It is very convenient because you can easily access the information of the stocks you are interested in.
<watchlist>
Finally, let us introduce how to access the "themes." Please operate while looking at the actual app screen as we explain.
1. After opening the app, tap "Market" at the bottom of the screen.
2. The overview page of the market will be displayed. Tap "Japanese stocks" or "US stocks" on the top of the screen. This time, we tap "Japanese stocks."
3. After the Japanese stocks page is displayed, scroll down. When you scroll down to the bottom, the "themes" will appear, so tap "Details" on the right side of the theme.
4. The themes are displayed in a list. Let's tap the theme that you are interested in.
5. Related stocks for the theme are displayed in a list. Please search for stocks that you are interested in from this list. </watchlist></kininaru_meigara></kobetsu_meigara_no_jouhou_peji></kinrijo_shoukan_kanren_meigara></gainianbankuai>
The weather is good today 今日の天気は良いです
Please use your Futubull account to access the feature. Futubullアカウントをご利用ください。
As related stocks to rising interest rates, it has been found that Mitsubishi UFJ Financial Group, Japan Post, and Fukuoka Financial Group are among them. If there is a stock that interests you, tap on the name of the stock. A page will be displayed with consolidated information on stock price charts, financial statements, and other information necessary for investment judgment.
<individual stock="" information="" page=""></individual>
Additionally, this page contains various information ranging from beginner to intermediate levels. Since it is difficult to make full use of all the information from the beginning, we will explain the recommended functions for beginners later.
Moreover, it is recommended to tap the "♡" on the right side of the stock you are interested in.
<stocks of="" concern=""></stocks>
When you tap the "♡", it is registered as a favorite stock and displayed on the top page (watchlist tab) of the moomoo app. It is very convenient because you can easily access the information of the stocks you are interested in.
<watchlist></watchlist>
Access to Gainianbankuai
Finally, let us introduce how to access the "themes." Please operate while looking at the actual app screen as we explain.
1. When you open the app, tap 'Market' at the bottom of the screen.
The market overview page will be displayed. Tap 'Japanese stocks' or 'US stocks' at the top of the screen. You will tap 'Japanese Stocks' this time.
③ After the Japanese stocks page is displayed, scroll down. When you scroll down to the bottom, the "themes" will appear, so tap "Details" on the right side of the theme.
④ The themes are displayed in a list. Let's tap the theme that you are interested in.
⑤ Related stocks for the theme are displayed in a list. Please search for stocks that you are interested in from this list.
Let's uncover the stocks from the "high dividend ranking." This is a popular option for beginners which is presented in the ranking format for both the Japanese and U.S. stocks.
<high_dividend_ranking>
If you actually look at the high dividend ranking, there are high dividend stocks of nearly 8%. If you assume that you invest 1 million yen, it looks quite attractive to be able to receive 80,000 yen in dividend income. However, be aware that some of these stocks have a high dividend yield due to the poor business performance and the declining stock price. </high_dividend_ranking>
This is a popular option for beginners which is presented in the ranking format for both the Japanese and U.S. stocks.
If you actually look at the high dividend ranking, there are high dividend stocks of nearly 8%. If you assume that you invest 1 million yen, it looks quite attractive to be able to receive 80,000 yen in dividend income. However, be aware that some of these stocks have a high dividend yield due to the poor business performance and the declining stock price.
<high_dividend_ranking>
</high_dividend_ranking>
In fact, when you look at the high dividend ranking, you can find high dividend stocks that are close to 8%. It seems quite attractive when you consider that you can get a dividend of 80,000 yen if you invest 1 million yen. However, some of these stocks may have a high dividend yield due to the poor performance of the company and the low stock price, so caution is required.
You can understand this reason when you understand the calculation formula for dividends yield. The calculation formula for dividends yield is calculated by the following formula.
For example, if the dividend per share is 10 yen and the stock price is 100 yen per share, the dividend yield can be calculated as '10%' using the calculation formula below.
Here, if the dividend per share remains at 10 yen and the stock price drops to half, 50 yen, the dividend yield becomes '20%'.
Due to the drop in stock price, the dividend yield has increased significantly from 10% to 20%. Although the increase in dividend yield is a good thing, it is important to note that the cause is a decrease in stock price.
There are two main reasons for the drop in stock price. One is due to external factors, such as the global trend resulting from the 2020 Corona shock, which may cause stock prices to drop worldwide. The other is due to internal factors, such as poor management leading to a decline in business performance and a drop in stock prices.
If the stock price is dropping due to the second internal factor, it is better not to invest even if the dividend yield increases and becomes more attractive. If you buy such stocks, dividends may be reduced or even eliminated (reduced or eliminated), depending on the decline in business performance. Naturally, if dividends are reduced or eliminated, stock prices will continue to decline.
To avoid such stocks, it is recommended to choose stocks with a '3-6% dividend yield'. With stocks at this level, it is believed that there is a low probability that the reason why dividends yield have risen significantly is due to the deterioration of business performance.
Access to the 'high dividend list'.
You can access the high dividend list by following the steps below.
1. When you open the app, tap 'Market' at the bottom of the screen.
The market overview page will be displayed. Tap 'Japanese stocks' or 'US stocks' at the top of the screen. You will tap 'Japanese Stocks' this time.
As you scroll down, there is an item called 'high dividends' just below 'heat map'. Since the top 3 stocks are displayed here, tap 'details' on the right to get more information.
The ranking of high dividend stocks is displayed. When you tap the stock name, it jumps to the dividend introduction part on the individual stock page.
2.1.3. Discovering stocks from 'shareholder benefits'
Even beginners can find investment opportunities from popular 'shareholder benefit' stocks. In the moomoo app, shares are organized by category, such as 'food and meal vouchers', 'specialty products', and 'shopping vouchers'. First, look for stocks in the category of shareholder benefits that you want.
< Categories >
For example, when you tap 'food and meal vouchers', the image of shareholder benefits and the list of stocks are displayed as shown in the image below. There are various shareholder benefits such as meal vouchers at restaurants, steak sets, and sparkling wine. It is good to invest in meal vouchers at your favorite restaurants, or choose a steak set for a little luxury. Some shareholder benefits are even delivered twice a year from the company. If you think that you can receive gifts from the company twice a year, it is very exciting!
< Shareholder Benefit Page >
If you find a shareholder benefit that interests you, tap the stock name to see detailed information on the shareholder benefit. As an example, let me introduce you to the shareholder benefits of Watami. There are two kinds of information posted, basic information that is required to receive the shareholder benefit and information regarding the content of the shareholder benefit.
The basic information needed to receive shareholder benefits is summarized compactly in the image below, such as minimum purchase amount, number of shares eligible for shareholder benefits, and final ex-dividend date. The information to watch for is the part circled in red in the image below (minimum purchase amount, number of shares eligible for shareholder benefits, record date, and final ex-dividend date).
<watami shareholder="" benefit="" overview=""> </watami>
We have summarized the meaning of each term.
In the case of WATAMI, at least 100 shares are required to receive shareholder benefits, which requires a capital of about 100,000 yen. In addition, the rights determination months are March and September, and it is understood that shareholder benefits are obtained twice a year. The rights expiration date is displayed as March 27, 2024, and if you own WATAMI's shares on this day, you can receive shareholder benefits. Please be careful not to sell your shares on the rights expiration date.
Let me explain more about the rights expiration date. As I explained before, you can receive shareholder benefits if you have them on the 'rights expiration date'. However, strictly speaking, the right to receive shareholder benefits is determined not on the rights expiration date itself, but on the 'rights record date', which is two business days after the rights expiration date.
<relationship between="" rights="" expiration="" date="" and="" record=""> </relationship>
So why do you have to have shares on the rights expiration date rather than the rights record date? The reason for this is that it takes two business days to transfer stock certificates. To correctly explain the conditions for receiving shareholder benefits, it is necessary for your name to appear on the shareholder register on the rights record date. In order to have your name on the shareholder register, the transfer of the stock certificate must be completed by the rights record date. Therefore, it is necessary to purchase the shares two business days prior to the rights record date.
That was an explanation of the moomoo app's shareholder benefit information and structure.
Finally, I would like to introduce a great deal for those who 'want to receive shareholder benefits immediately'. If you are one of these people, we recommend searching for shareholder benefits under 'This Month's Benefits'. The 'This Month's Benefits' page lists the stocks for which the rights record date is set at the end of the current month.
<this month's="" benefits=""> </this>
The rules for receiving shareholder benefits are the same as before, so if you want a particular shareholder benefit, just make sure to own the shares for that stock on or before the rights expiration date. Please note that shareholder benefits are not delivered immediately after the rights record date and there is a lag of about 2-3 months. During this time, think about how you would like to use your shareholder benefits and enjoy the wait.
Please note that only Japanese companies implement shareholder benefits, so be careful as American companies do not have this concept.
Access to 'Shareholder benefits'
You can access shareholder benefits using the following steps.
1. When you open the app, tap 'Market' at the bottom of the screen.
2. The market overview page will appear. Tap 'Japanese stocks' on the top of the screen.
3. As you scroll down the Japanese stock page, 'Shareholder Benefits' will appear just below the 'Economic Calendar'. If you are looking for shareholder benefits by genre, tap 'Details' on the right. If you want to know the benefits available this month, tap 'This Month's Benefits'.
4. The shareholder benefits list page will be displayed. From here, you can search for the shareholder benefits you are interested in.
2.2. Deepen your understanding of individual stocks
When you hear 'stock investment', many people may think of 'stock price charts'. Chart analysis is very important as stock price charts reflect not only investors' psychology but also companies' performance. However, in order to understand such investors' psychology and companies' performance, it is necessary to deepen one's understanding of individual stocks.
There are two ways to deepen your understanding of individual stocks. One is to understand the business and the other is to check the financial numbers. Financial numbers may seem difficult to understand, but they are what helps you understand things like the company's growth potential, profit-making ability, and the risk of bankruptcy. Think of it like a 'school report card'. Once you understand the basics of how to read a report card, anyone can easily obtain information. Plus, since financial numbers are illustrated in the moomoo app, even beginners can easily understand. Don't stress too much and keep studying.
In the moomoo app, all the necessary information for analysis is covered. Some niche topics for intermediate and advanced level investors are included, so there is no need to go through everything at the beginning. So, what sections should beginner investors look at? We have picked 5 recommended topics.
Let's explain each one.
2.2.1. ①Shikiho (Four Seasons Report): You can obtain information from the Shikiho (Four Seasons Report), known as the investment bible, through the moomoo app. There is a great deal of information available, such as the nature of the business and financial figures, but for beginner investors, it would be ideal to check the "Business Summary" section. For example, the business summary section for Mercari reads, "The leading domestic flea market app. The sales commission is the pillar. The mobile payment 'MerPay' business is strengthening its position in the US flea market." Mercari is well known in Japan and many people can picture its business, but there are also many people who didn't know about their retail business in the US. By reading the business summary, you can check if your own image of the company matches with the reality and whether there are any aspects that you didn't immediately comprehend. As an entrance to improve your understanding of a company, you should definitely check the business summary.
If you tap on 'Details' to the right of the Business Summary in the Shikiho, you can see more detailed information. When you tap on Details, you can check not only the detailed information, such as the sector, the market capitalization, etc., but also the information regarding shareholders. If you have some extra capacity, it is also recommended to read the commentary article by Shikiho reporters. This article summarizes the research conducted by Shikiho reporters and provides the latest updates on company management. The information has been filtered by Shikiho reporters, therefore it is not advisable to accept it without reservation, but it is a valuable source of information that easily provides you with the latest information about management situation and trending topics. Please give it a try.
By the way, the data in Shikiho is limited to Japanese stocks. Shikiho data for US stocks is not available. Instead, you can scroll down to the analysis tab, where a simplified description of business details is provided. Since the text is long and only partially displayed (like in the image below), you need to tap on 'Details' in the upper right corner to read the entire article:
<mercari: shikiho=""> If you tap on 'Details' to the right of the Business Summary in the Shikiho, you can see more detailed information. When you tap on Details, you can check not only the detailed information, such as the sector, the market capitalization, etc., but also the information regarding shareholders. If you have some extra capacity, it is also recommended to read the commentary article by Shikiho reporters. This article summarizes the research conducted by Shikiho reporters and provides the latest updates on company management. The information has been filtered by Shikiho reporters, therefore it is not advisable to accept it without reservation, but it is a valuable source of information that easily provides you with the latest information about management situation and trending topics. Please give it a try.</mercari:>
<mercari: comment="" by="" reporters=""></mercari:>
To access Shikiho, open the app and choose the individual page of the stock you want to analyze. Then, tap 'Analysis' located on the screen. Note that this is the same as steps 1-3 for 'Company Valuation'.
To access 'Company Valuation', open the app and choose the individual page of the stock you want to analyze. Then, tap 'Analysis' located on the screen. Note that this is the same as steps 1-3 for 'Shikiho'.
You can check more detailed information such as the business sector, market capitalization, etc., by tapping on 'Details'. Furthermore, you can confirm information such as the shareholder composition. Thus, it is recommended to read the commentary article by Shikiho reporters if you have some extra capacity. This article summarizes the research conducted by Shikiho reporters and provides the latest updates on company management. Although this information is filtered by Shikiho reporters and shouldn't be accepted without reservation, it is still a valuable source of information that allows you to quickly obtain updates on management situation and trending topics. Please check it out.
<tesla: overview="">If you tap on 'Details', basic information such as stock code and listing date, as well as business details such as the 'Profile' section, will be displayed. If you want to know the business details of a US company, check the 'Profile' section.</tesla:>
<tesla: profile=""></tesla:>
Note that the data in Shikiho is limited to Japanese stocks. Shikiho data for US stocks is not available. Instead, you can scroll down to the analysis tab, where a simplified description of business details is provided. Since the text is long and only partially displayed (like in the image below), you need to tap on 'Details' in the upper right corner to read the entire article:
If you tap on 'Details', basic information such as stock code and listing date, as well as business details such as the 'Profile' section, will be displayed. If you want to know the business details of a US company, check the 'Profile' section.
<tesla: profile=""></tesla:>
Access to Shikiho:To access Shikiho, open the app and choose the individual page of the stock you want to analyze. Then, tap 'Analysis' located on the screen. Note that this is the same as steps 1-3 for 'Company Valuation'.
Access to 'Company Valuation': To access 'Company Valuation', open the app and choose the individual page of the stock you want to analyze. Then, tap 'Analysis' located on the screen. Note that this is the same as steps 1-3 for 'Shikiho'.
①After you open the app and display the individual page of the stock you want to analyze, tap "Analyze" on the screen. Note that the procedure up to this point is the same as steps ① to ③ of "Accessing Company Valuation".
Above the analysis tab, there are listings for financial (in Japanese yen) and shareholder. Please tap "Shikiho" among them.
Shikiho will be displayed. If you want to know details, such as company overview and financial situation, tap "Details" on the right side of each item.
2.2.2. ② Company Valuation
"Enterprise evaluation" includes indicators for determining the undervaluation of the stock. Specifically, it is a mechanism that displays PER (price-earnings ratio), PBR (price-to-book ratio), or PSR (price-to-sales ratio), which judge whether the stock price is undervalued relative to the profit earned by the company, whether the stock price is undervalued relative to the company's net assets, or whether the stock price is undervalued relative to the sales, respectively (this varies depending on the company).
<merucari's corporate="" evaluation=""></merucari's>
For Mercari, PSR is displayed. It is 1.60 times compared to the industry average of 1.67 times, which shows a slightly undervalued feeling compared to the average. It's nice to be able to quickly compare with the industry average like this.
PER, PBR, and PSR displayed here are important judging materials when making stock investments. We have summarized the meanings and usage of each indicator in a table format, so it is worth knowing them.
When you tap the "Details" on the right side of the Enterprise Evaluation, historical trends, industry distributions, and market distributions such as PER and PBR are displayed. Beginners don't need to confirm this much, but it's a good idea to use it when you get used to it.
<information provided="" in="" the="" "details"=""></information>
<mercari: psr="" trends=""></mercari:>
If you tap "Listing Comparison" located on the right side of past distribution, comparison of stocks such as PER, PBR, and PSR can be done. It is a very convenient function that allows you to judge whether it is undervalued compared to the same industry competitors. (In the following image, we compared Mercari and Jayde Group, which operates a shoe EC site, as an example.)
<mercari vs.="" jayde="" group:="" psr="" comparison=""></mercari>
Access to the "Enterprise Evaluation"
You can access the "Enterprise Evaluation" as follows:
After opening the app, tap the magnifying glass icon in the upper right-hand corner of the screen.
The stock search screen appears. When you enter the company name or stock code in the search bar above, the company name is displayed below the search bar. Please tap the company name you want to check.
The company page will be displayed. Let's tap "Analysis" on the screen.
When you scroll down the Analysis tab, "Enterprise Value" is displayed immediately below the "Morningstar Rating". If you want to know detailed information, please tap "Details" on the right side.
2.2.3. ③Income statement
From here, let's look at the "Communication Book" of the target company. The corporate communication book consists of three parts: "income statement," "balance sheet," and "cash flow statement." Please refer to the table below for the contents of each document.
<three communication="" books="" disclosed="" by="" companies=""></three>
Of these, the "income statement" is particularly important for stock beginners. I will explain in an easy-to-understand way what to focus on, as it is an important document for determining whether a company is growing or not.
Let's take a look at a real income statement. The image below is the income statement of Mercari. Since it is just a list of letters and numbers, most people find it difficult to decipher.
<mercari's consolidated="" income="" statement=""></mercari's>
(Source: Mercari 2023 Securities Report)
You may have thought, "do I have to read such a complicated document in order to invest in stocks?" Don't worry, with the moomoo app, you can check the information on the income statement with graphs.
<mercari's income="" statement=""></mercari's>
With this, you can easily grasp whether sales and profits are increasing or decreasing. Especially just after starting to invest in stocks, it is difficult to judge whether a company is growing just by looking at numbers, so it is recommended to use the moomoo app to visually check performance.
With the moomoo app, you can check four items: "Operating Income (Revenue)", "Operating Profit", "Net Profit", and "Ordinary Profit Attributable to Shareholders".
<items on="" the="" income="" statement="" that="" can="" be="" checked="" with="" moomoo="" app=""></items>
Of these, the three to focus on are "Operating Income (Revenue)", "Operating Profit", and "Ordinary Profit Attributable to Shareholders". This is because if operating income is increasing, it means that the sale of goods or services is doing well, and if operating profit is increasing, it means that the core business is making a solid profit. It is considered that such companies are highly likely to continue to grow in the future.
The reason to check the third item, Ordinary Profit Attributable to Shareholders, is to confirm whether the net profit that becomes our shareholder's share is increasing. Please focus on these three graphs and check whether the target company is growing.
So far, I have told you to pay attention to whether operating income, operating profit, and ordinary profit attributable to shareholders are on the rise. However, in reality, there may be companies that are expected to grow even if operating profit is in the red.
For example, if a large amount of advertising and publicity expenses are invested and brand awareness is quickly raised, it is considered that the performance will grow significantly in the future. Such companies often have negative operating profits. Note that it cannot be declared that a company has no growth potential just because its operating profit is in the red. Once you get used to investing in stocks, you may want to focus on such companies as well.
Let's go back to how to use the moomoo app. By default, the numeric values of "Quarterly Settlements" are displayed on the moomoo app. It is important to check the growth on a quarterly basis, but in order to consider whether growth is possible in the medium to long term, it is necessary to check at least the past five years' performance to see if it is on the rise. Therefore, it is recommended to switch the graph to "Annual Settlements".
To switch to annual settlements, tap "Quarterly Settlements▼" on the graph of the income statement. There are three options to choose from: "Annual Settlements", "Quarterly Settlements", and "Cumulative Quarterly Settlements". Tap the top option, "Annual Settlements".
<display period="" of="" the="" income="" statement=""></display>
In addition, by tapping "Details＞" on the upper right of the income statement, you can check each item on the income statement with a graph. Beginners do not need to check this function up to this point, but it is a recommended function for those who want to check the details of the breakdown of expenses.
<mercari: income="" statement="" (details)=""></mercari:>
Access to "profit and loss statement".
①After you open the app and display the individual page of the stock you want to analyze, tap "Analyze" on the screen. Note that the procedure up to this point is the same as steps ① to ③ of "Accessing Company Valuation".
If you scroll down the analysis tab in step ②, the profit and loss statement is displayed just below the financial indicators.
2.2.4. Financial Indicators
After checking the income statement, let's check the financial numbers. Here, important indicators that you want to check when making investment decisions, such as EPS, ROE, gross margin, etc., are summarized. Like the income statement, it can be visually grasped using graphs, so it is recommended for beginners in stocks.
<financial indicators=""></financial>
We have organized the indicator names and meanings summarized in the financial indicators into a table. There are a total of 8 indicators, but for beginners, focusing on ROE is sufficient. This is the part highlighted in orange in the table on the next page.
The reason to focus on ROE among the many indicators is to see how much profit the company has made by using the money invested by shareholders, and to understand the company's profitability and efficiency from the shareholders' perspective. In addition to the income statement we confirmed earlier, it is important to check the company's ability to profit, so we are focusing on ROE.
So, how should we use ROE to make investment decisions? Textbook-wise, it is said that an ROE of 8% or more is a desirable level. I will omit the detailed explanation because it is a difficult story, but an ROE of 8% or more is considered to be able to generate profits that exceed the return demanded by shareholders and has the ability to make a profit.
Also, the graph in the financial indicators shows the data for quarterly settlements by default. Tap "Quarterly Settlements▼" on the graph to switch to the graph for annual settlements and quarterly cumulative settlements, and check the graph after switching to annual settlements.
<display period="" of="" financial="" indicators=""></display>
In the case of Mercari, the ROE for the fiscal year ending March 2023 was 28.30%. It exceeds the indicative 8%, which clearly shows that it is using the shareholders' funds efficiently.
<mercari: transition="" of="" roe=""></mercari:>
On the other hand, looking at the past ROE, negative years stand out. This is because Mercari is actively investing in advertising and personnel expenses, mainly in overseas expansion (USA). As a result of the aggressive investment, which has increased the cost, the operating profit and net profit were in the red, and ROE was also negative.
At present, due to the growth in sales revenue, investments in advertising and personnel expenses can be made actively as before, and profits can be made even if ROE is positive. As a result, ROE became positive.
Access to financial indicators
You can access the financial indicators using the following steps.
①After you open the app and display the individual page of the stock you want to analyze, tap "Analyze" on the screen. Note that the procedure up to this point is the same as steps ① to ③ of "Accessing Company Valuation".
If you scroll down the analysis tab in step ②, financial indicators are displayed just below the prediction.
Dividends (5)
The fifth function that beginners should check is information on dividends. In the moomoo app, the graph shows the transition of dividends and dividend yield, and also displays the dividend payout ratio as an indicator related to dividends. If you are investing in high dividend stocks, check the transition of dividends and the indicators related to dividends that are displayed here.
<mitsubishi ufj="" financial="" group:="" dividend=""></mitsubishi>
We will explain the dividend yield and dividend payout ratio. The dividend yield is an indicator that shows how much dividend can be obtained as a percentage of the investment amount, and the dividend payout ratio is an indicator that shows what percentage of the net profit earned by the company is paid as dividends to investors.
Here are three points to keep in mind when investing in high dividend stocks.
First, check if the dividend has decreased. The dividend is shown as a blue bar graph. If the dividend is reduced (reduced dividend) when investing in high dividend stocks, the stock price will drop due to disappointment sales. Ideally, it is desirable to have stocks for which the dividend is increasing.
Next, confirm whether the dividend yield is 3-6%. This is to avoid stocks where the dividend yield has become high due to poor performance.
There are also stocks (7% or 8%) that exceed this level, but it is possible that the dividend yield has become higher due to poor performance and the stock price has declined. Be careful investing in such stocks as there is a risk that poor performance will lead to further declines in stock prices.
Finally, confirm whether the dividend payout ratio is below 50%. The dividend payout ratio is an indicator that shows what percentage of the net profit per share earned by the company was paid as a dividend. Therefore, a higher dividend payout ratio is considered desirable.
However, a very high dividend payout ratio is undesirable. If the dividend payout ratio is 50% or more, especially 100% or more, caution is required.
While a high dividend payout ratio may seem desirable in that investors can receive a large amount of dividends, the company's share of the profits will be reduced, making it impossible to invest in growth investments for the future. Furthermore, since future performance growth cannot be expected and stock prices may be less likely to rise, a high dividend payout ratio is actually not desirable for investors.
If the dividend payout ratio is less than 50%, it is considered that investors have secured funds to return to shareholders while also investing in growth investments. Moreover, even if a temporary crisis such as the corona shock occurs and the net profit per share is halved, it is theoretically possible to maintain the dividend. Recommended stocks have a dividend payout ratio of 50% or less.
Access to dividends.
①After you open the app and display the individual page of the stock you want to analyze, tap "Analyze" on the screen. Note that the procedure up to this point is the same as steps ① to ③ of "Accessing Company Valuation".
Finance (Japanese yen) and Shareholders are listed above the Analysis tab. Tap "Dividend" among them.
The dividend is displayed. If you want to know detailed information such as dividend history, tap "Details" on the right side of the dividend.
2.3. Get financial results
After checking the financial figures of individual stocks and understanding information about the company's business and performance, gather the latest financial results information. At the top of the "Analysis" tab in the moomoo app, an overview of the latest financial results is compiled.
As an example, let's take a look at Mercari's latest financial results. As of May 1, 2024, when this report was created, the financial data for the second quarter of the 2024 fiscal year (June 2024 quarter) is the latest financial results data.
As shown in the image below, there are two items: revenue and EPS (net profit per share). The growth rate compared to the same period of the previous year is also posted, allowing you to understand how much the company has grown compared to the previous year.
<mercari: latest="" financial="" results=""></mercari:>
However, from this information, you cannot tell whether "growth rate compared to the previous year" is higher or lower. If the "growth rate compared to the previous year is 9% or higher", the company may be in a growth phase or the business environment or structure may have changed significantly. On the other hand, if it is lower than in the past, the performance may be nearing its peak.
This is why it is recommended to compare past performance using the "income statement" introduced earlier in order to make an investment decision, since you cannot tell whether the current growth rate is higher or lower than in the past. Check whether past performance has continued to grow steadily in order to select stocks that are likely to continue to grow stably in the future.
<mercari: income="" statement="" quarterly="" transition=""></mercari:>
Of course, no one knows what the future holds, so it cannot be said that companies will continue to grow as they have in the past. However, companies that have been consistently growing their performance to date should have the management capabilities and business models to continue to steadily grow their performance in the future. To confirm the presence or absence of such management capabilities and business models, we check whether past performance has shown stable growth.
When you have some spare time, take a look at the performance graph and consider the reasons for the stable growth. A simple example is a restaurant. The revenue of a restaurant business can be calculated by 'sales per store x number of stores', so an increase in sales per store or an increase in the number of stores is necessary for revenue growth.
If you open 30 new stores every year, it can be imagined that performance will continue to grow steadily. In this way, you can unravel the reasons for stable growth from a company's business model.
Knowledge of business models can be acquired through accumulating company analysis and reading books on various business models. It's a long process, but as you level up from being a beginner, to a novice, to an intermediate level, you'll want to increase your knowledge.
In some companies, such as automobile sales or game sales, you can check the number of sales.
In some Japanese and American stocks, when you tap the latest settlement, you can confirm something called 'company business data'. This summarizes the important indicators of each company, such as the number of automobile sales and software downloads.
For example, in the case of Nintendo, you can confirm the number of 'Nintendo Switch hardware sales', 'Nintendo Switch compatible software sales', and 'annual play users'.
Nintendo Switch Hardware Sales and Compatible Software Sales
Annual Play Users
In the case of Nintendo, the number of Nintendo Switch compatible software sales has increased from 2020 to 2021. This is likely due to the increase in at-home time during the COVID-19 pandemic and the explosive popularity of 'Animal Crossing'.
By paying attention not only to financial numbers such as revenue and operating profit margin, but also to business data, you can deepen your understanding of companies. Try to incorporate it into your analysis once you have some spare time.
In the case of American stocks, you can obtain more detailed settlement information. For Japanese stocks, only revenue and EPS were available in the latest settlements, but for American stocks, highlights (briefings), earnings call Q&A sessions, performance graphs, and more are included.
Especially in Q&A sessions, you may find answers to questions that arise while interpreting earnings reports. You can also learn how other investors think, so if you're considering investing in US stocks, please read it once.
Tesla: Latest Settlement Highlights (Briefing)
Tesla: Earnings Call Q&A Session
Tesla: Performance Graph
If you open the analysis tab, you will see "XX financial year QX quarterly settlement" immediately. If you want to know detailed information about the latest settlements, please tap "settlement" on the right.
①After you open the app and display the individual page of the stock you want to analyze, tap "Analyze" on the screen. Note that the procedure up to this point is the same as steps ① to ③ of "Accessing Company Valuation".
When you open the analysis tab, "〇〇 fiscal year Q△ quarterly settlement" is displayed immediately. If you want detailed information about the latest settlement, please tap "Settlement" on the right.
2.4. Practice stock investment with papertrade.
Once you have learned how to collect necessary information to make investment decisions, it is time to put it into practice. Although some people may feel that taking the leap to invest their hard-earned money is a high hurdle, using surplus funds to actually buy stocks is recommended. For those people, we recommend papertrade.
Using the papertrade feature included in the moomoo app, you can practice trading under the same environment as actual trading. Although it is a simulation, the movements of the actual stock market are reflected, allowing you to experience the stock market realistically. First, try papertrade and get used to stock investment.
<papertrade screen=""> </papertrade>
With the moomoo app, you can perform papertrade on Japanese stocks and US stocks. For Japanese stocks, you can start with a starting capital of 20 million yen, and for US stocks, you can start with 1 million dollars. You can trade stocks of companies that you are interested in, such as stocks selected from themes or high dividend stocks.
2.4.1. How to Operate Papertrade (Purchase)
We will explain how to operate the papertrade feature. With actual images and explanations in order, if you are having trouble with the operation, please come back to this page anytime.
①Open the moomoo app, and tap the 'Investment Navigation' bar at the bottom of the screen.
<tap on="" the="" investment="" navigation=""> </tap>
②Tap on 'Papertrade'.
<tap on="" papertrade=""> </tap>
③The papertrade screen will open. The starting capital for Japanese stocks is 20 million yen, and the starting capital for US stocks is 1 million dollars.
<papertrade screen=""> </papertrade>
Note that you can switch between Japanese and US stocks by tapping the part labeled 'Japanese stocks (Papertrade)' or 'US stocks (Papertrade)'.
<switching between="" japanese="" and="" us="" stocks=""> </switching>
<selecting japanese="" or="" us="" stocks=""> </selecting>
④If you want to place an order, tap 'Speed Order'. An order screen will appear, where you should enter the 'stock code' of the stock you want to buy in the 【code】field, 'Market Order' in the 【Type】field, and the number of stocks you want to buy in the 【Quantity】field. As 'Demo Buy' is the default in the 【Buy/Sell】field, it does not need to be changed.
< Order screen >
As an example, let's try to buy Mercari (4385) stock. Since the stock code for Mercari is '4385', tap the part that says 'Enter stock code...' in the 【Code】field and enter the stock code. Also, if you enter the company name, it includes a feature that will automatically search for the securities code, so if you do not know the securities code, please try searching by the company name.
<entering the="" securities="" code=""> </entering>
Stock code has been entered.
< Order screen >
Next, set the < condition >." Limit order" is selected by default. This is an order that specifies the price you want to buy." Sell orders below the specified buy price will not be made, so it often takes time for limit orders to be executed." Therefore, for beginners, it is recommended to use a "market order" to get used to investing. "Market orders" are orders that leave the buying price to the market without specifying it." I want to buy this stock, so sell it to me anytime" The transaction is often executed immediately.
Therefore, for beginners, it is recommended to use a "market order" to get used to investing. "Market orders" are orders that leave the buying price to the market without specifying it." I want to buy this stock, so sell it to me anytime" The transaction is often executed immediately.
To change to a market order, tap the "V" next to the "limit order" that is set by default. "Market order" options will be displayed.
< Tap the "V" next to the limit order >
< Choose market order >
Finally, let's set the < quantity >. The default is "100 shares". If you want to buy more than 100 shares, tap the "+" or "-" to change it. This time, we will only buy 100 shares, so we won't change anything in particular.
< Enter the quantity >
Note that for Japanese stocks, trading is based on "100 shares" as a unit. Therefore, the minimum purchase amount is "stock price x 100 shares". At the time of writing this report (May 2, 2024), Mercari is traded at around 1800 yen, so you need about 180,000 yen.
*In the case of a market order, the transaction may not be executed at the stock price being offered in the market, so an approximate order estimate, called an "indicative quote," is displayed. In fact, the indicative quotation for Mercari, which is trading at around 1800 yen, is shown to be 213,060 yen.
After entering the required information for the buy order, tap the "Demo Buy" button.
< Tap Demo Buy >
A pop-up like the one below will be displayed, but if you tap "Confirm," it will be OK. If you don't want to display it again from next time, check the "Don't show again" box.
< Demo trade alert >
The order details will be displayed. Check the details and if everything is okay, tap "Confirm".
< Order details >
When "Your order has been accepted" is displayed, the purchase is complete. Press "OK" to close the pop-up.
< Your order has been accepted >
When you close the pop-up, you will return to the demo trade order screen. Since it is a mechanism to display "hold positions" at the bottom of the screen, check if the stock you just bought is displayed.
<hold positions="" confirmation=""> </hold>
2.4.2. How to Operate Papertrade (Sell)
Next, let me explain how to sell the stocks that you purchased in papertrade. As with the purchase section, I will use the actual app screen to explain the steps.
Once you have brought up the papertrade screen, please tap "Speed Order" located in the lower left corner of the net asset value.
<tap "speed="" order"=""></tap>
Once you tap the stock you wish to sell, two buttons, "Current market price" and "Trade," will appear beneath the stock. As we are placing a sell order, please tap "Trade."
<tap the="" stock="" you="" wish="" to="" sell=""></tap>
When you tap the stock you wish to sell, two buttons, "Current market price" and "Trade," will appear beneath the stock. As we are placing a sell order, please tap "Trade."
<tap "trade"=""></tap>
The stock name and stock code will be automatically displayed on the trade screen. As we are selling the stock, please tap "Demo Sell" located in the center of the screen.
<tap "demo="" sell"=""></tap>
Once again, we will use a market order to sell. Since a market order is already set by default, you do not need to change the condition type. If you want to change the number of shares sold, please tap the "+" and "-" buttons located next to the "Quantity". As we only have 100 shares of Mercari, we will not change the quantity. After you finish setting the conditions, please tap the green "Demo Sell" located at the bottom of the screen.
<set the="" conditions="" and="" tap="" "demo="" sell"=""></set>
A papertrade alert will appear. Please tap "Confirm" located in the lower right corner of the screen.
<tap "confirm"=""></tap>
The order screen will appear. Please confirm the order details and tap "Confirm" located in the lower right corner of the screen.
<tap "confirm"=""></tap>
Once "Your order has been accepted" appears, your papertrade sell order is complete. Please tap "OK."
<tap "ok"=""></tap>
When the popup is closed, the papertrade screen will reappear. Information on the stock that was just sold will be displayed under "Current day order." If "filled" appears beneath "Demo sell," it means the sale is complete.
Check the order on the day.
Finally,
We have introduced how to use the moomoo app and its practical application. With this app, you can trade and analyze in one stop without the need to look for financial statements or check specialized information sites on the internet. It can be said that it is an app that is appreciated not only by Z generations who are familiar with trading on smartphones but also by salarymen investors who want to efficiently collect information during commuting time.
At moomoo Securities, we add functions that professionals use and enhance information to eliminate information disparities between individual investors and professionals. We will introduce new functions in detail in "Easy way to start stocks" every time they are added in the future. Please take a look at our website as well.
I hope that those who have read this report will feel a little closer to stock investment and will be able to efficiently collect the necessary information for their investment decisions. Thank you for reading until the end.
We look forward to your continued use of the "Easy Way to Start Stocks" website (https://kabukiso.com/).
Easy Way to Start Stocks editorial department Kei Nishio
Site Administrator Hikki
Disclaimer
Investment targets and investment methods described in this report are not guaranteed to protect principal or profits and may result in losses due to fluctuations in the market or interest rate differentials. We ask that you understand the investment targets and trading mechanisms and risks well and make transactions at your own judgment and responsibility.
While we have created this report with the utmost care based on the information available at the time of creation, we do not guarantee the accuracy or safety of its contents. Furthermore, this is intended to provide information that serves as a reference for learning investment knowledge and does not recommend specific investment behavior or management methods for specific stocks or investment targets.
Please make the final decision regarding investment by yourself.
Any profits or losses incurred by investment belong entirely to investors.
Please note that information providers are not responsible for any damages incurred based on the information provided.
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