It is highly encouraged for you to find several different stocks across the various market sectors so that you can take advantage of stronger trending markets. Remember, liquidity is your friend (see Buy/Sell Orders and Bid vs Ask).
Start looking at the Nasdaq, S&P 500, or ones held by major institutions (Backrock) for stocks to consider; if they like them, there is probably a good reason.
Find stocks that have an average volume in the millions; the more the better
Look for stocks that are market leaders or provide a product (good or service) that is irreplaceable (e.g. MSFT)
Finding the top 2-3 is always a great idea since less than 25% of market leaders are the market leaders in the next market cycle
We are identifying a number of stocks so that we can find the few we will follow for the week that offer the best potential
You can decide to trade only a few stocks to help you concentrate on your entries, exits, how the stock moves (resistance, support, movement away from 20MA, etc), and charting (alerts, targets, earnings, catalysts). You may select individual stocks or indices to follow.
Some of the most successful traders only trade a handful of stocks or specialize in one to two particular stocks
Sectors and Stocks
Based on price, ATR, and if you are playing options, you will select the ones that best fit you. I recommend sticking with the major indices (SPY, QQQ, IWM) when you get started and slowly add companies you believe in and that have the fundamentals and technical analysis behind it. If you find that the risk is too high on higher priced stocks or that their price fluctuates too quickly for your trading, select a stock with a lower ATR. When you get comfortable with setups and movements, you can move to bigger ATRs.
Indices:
SPY and SPX follow /ES. I follow /ES to make decisions on SPY and SPX.
QQQ and /NQ; 85% of the holdings are in SPX
IWM - small caps that will offer exponential growth if the businesses succeed past their initial stages of development and scaling
SOXL - semiconductors; unless technology disappears we should see this sector increase in computers, cars, space, and even manufacturing to name a few. An interesting development was the US government finally signing the bill to ramp up semiconductor manufacturing and sourcing in the US instead of being heavily reliant on China and Taiwan. In addition, AI leader, NVDA, and all other AI related chip manufacturers are now prohibited from selling them to other countries; especially China.
Here is a list of stocks and their Market Sector
AAPL - Consumer Electronics, Technology
MSFT - Technology, Software
TSLA - Consumer Cyclical, Auto
GOOG - Communication Services, Computer Information
AMZN - Consumer Cyclical, Internet Retail
NVDA, AMD, MU - Technology, Semiconductors
XOM, CVX - Energy, Oil, Oil equipment (HAL)
JNJ, MRNA, PFE - Healthcare, Drug Manufacturer (PFE, JNJ), Biotechnology (MRNA)
TGT, WMT, COST - Consumer Defensive, Discount Stores
HD, LOW - Home Improvement Retail, Consumer Cyclical
ABNB - Consumer Cyclical, Travel Services
X - US Steel
XLF, XLE, XLK, etc. - see Market Sectors
Personally, I go through a number of stocks that I like and then do not like. Here is my core of stocks that I normally trade. I will add some stocks from time to time
Overall Market or Indices - SPY, QQQ, IWM
Semiconductors - SOXL, NVDA, AMD, ON, MU
Steel - X
Oil - XLE, XOM, CVX
Tech Related - TSLA, MSFT, AAPL, GOOG, AMZN
Health - UNH (Love hate relationship because I trade UNH poorly)
Companies I believe are the outright leaders
AAPL, NVDA, GOOG, TSLA, MSFT, AMZN, ABNB
Until someone can present a viable threat to their market share or their products become obsolete, I do not see them going anywhere
Can't make a decision on which stock? Don't have enough money for the leaders like NVDA? Consider ETF's
ETF's - Exchange Traded Funds are created by hedgefunds and other investment companies to track a select group of stocks that can represent specific sectors, industries, or the entire market.
This can enable you to be invested in stocks that you could not purchase outright. As an example, NVDA shares at the time of me creating this page is $460/share, versus SOXL, a semiconductor ETF, is at $21/share. When semiconductors do well SOXL shares goes up in value. This allows you to invest in companies you like and to be able to purchase more shares.
Popular ETF's are SPY, QQQ, IWM just to name a few
Sites like Nasdaq.com or ETF.com allows you to learn more about ETF's: historical performance, holdings, expense ratio, and dividends. You can search through ETF.com's filter to sort through funds by performance, expense ratios, or other factors that are important to you.