This may be a difficult question for some people to answer but on average what is your initial target gain when investing in a company? Are you looking for 20%, 30%, 40% or more?
It is quite difficult to define the target since it all depends on numerous critera. 1. Industry specific and possibility of scaling. All companies have different scaling possibilities depending on their particular business. For example, retailer could double sales in a year, while it is almost impossible for steel producing plant. The more clients business could have, the easier it would be to increase the sales. 2. Shares float. As usual, low float stocks have better growth potential due to the relatively small supply. If investors become interested in such stocks, they would compete to get the amount of stocks they need and move the price up. Thus, profit expectations would depend on particular stock and fundamental situation, and there are no strict rules to deal with this uncertainty. For example, several yaers ago there was a stock PFIE, a company manufacturing special equipment for oil upstream production companies (burners). Despite the tight niche and B2B specific of their business the moved from 2.17 to almost 5,2 (over 100%) just in a few weeks after posting great quaterly results. So, the investor should be flexible and hold stocks long enough to make sufficient profit.
I think that while you need to have a target in mind - if you have no starting point and target, how can you focus on getting out? However, targets also need to be fluid and changeable - with the markets
