Types Of Stock Market Analysis

Okay, so now you have an idea about what happens in the stock market, you can name all the stock market participants, different stock types, different reasons why prices fluctuate, etc.

This is all obviously mega important, but I know what you’re thinking. You think this is boring.

Well, say no more my friend because this is where your journey as an investor begins…

This is your last chance to turn back.

No?

Are you sure?

Great! 

We know you wouldn’t anyway, you legend. 

What Is Stock Market Analysis?

Stock markets are highly unpredictable, and unless you take your time to analyse the markets and study your investments, there is a high chance it will turn into a gambling game. 

And you don’t want that to happen.

You want to make a smart and informed decision.

I know that because a gambler wouldn’t be reading this blog. 

At the end of the day, good research and knowledge will take you so much further than gambling ever could. 

Okay, time to get to the real stuff. 

There are various methods through which one can analyse the movement of the market, or in other words, perform a stock market analysis.

These fall into two broad categories: technical analysis and fundamental analysis.

Fundamental analysis is the study of an organisation’s stock prices in relation to the factors affecting the company such as its financials, revenue, profits, expenses, etc. 

Technical analysis, on the other hand, is heavily based on data and charting, patterns and trends. 

Technical Analysis And Fundamental Analysis.

So which type of analysis is the best?

The million-dollar question…

Everyone would love to know the answer to that, believe me.

There has been a constant debate as to which analysis is better for many years now, but to tell you the truth, neither of these techniques has been proven to have an overall advantage over the other.

In fact, many traders choose to combine these methods in an effort to conquer the stock market.

At the end of the day, not one method works for all and the key to success is to find the method that works best for YOU. 

Let’s start off by having a closer look at both, technical analysis and fundamental analysis, and how you would analyse and develop ideas to trade the stocks using each of these.

Ready when you are!