Do you wonder why MRC is shooting up lately? Also, MWIDE registering new highs almost every week? How about the gradual decline of STI from north of 1.23 and closing the week (April 21, 2017) at 1.03?
If only there’s a way to know which stock is the next bagger stock, right?
Unfortunately there’s no guaranteed way to know that. Nor any self proclaimed guru who seem to be knowledgeable on this subject let alone those paid subscriptions with a promise to give you recommendations can ever guarantee that.
Does that mean, you wont ever be able to profit from stocks? Of course not! Though you may not be able to exactly identify what will happen tomorrow, there are approaches you can use to increase the odds of predicting the future.
If you haven’t started yet, check out my How to Start with Stock Market Investing post or if already invested and want to get some tips, here’s my 7 tips for newbie investors you can read on.
Fundamental Analysis vs Technical Analysis:
Fundamental analysis is the analysis of the economy, company’s competition and business financial statements. This also studies how the company operates, how do they make money, what is the situation of their sector, etc. Using the knowledge from this data, the Fundamentalist calculates the valuation – what is the value of the company- and from there, they arrive with the target price.
Technical analysis on the other hand looks focuses on studying the past market data presented in a stock chart and deduce its trend whether up, down or sideways. If fundamentalists have financial statements to analyze, Technicians use technical indicators like MACD, Fibonaci, Ichimoku, etc. to identify support and resistances. -Soon, I’ll have a post about technical indicators as well.
Good thing there’s an info graph from wallstreetmojo and thought, this can help a lot of confused newbies on which approach should they try. Not only its easy to understand, it can save me tons of time writing for this subject, cool ey? 😆
By the way, I highly recommend you check out their post in full to know more about this subject.
I know this is a lot to digest. All those terms, analysis, news to think about, right? We’ll here’s my 2 cents, both approaches have their own pros and cons, so why not study both? I suggest focus on Fundamentals (my preference) first and when you’re comfortable already explore the other one. If for any reason you can only choose one, hands down fundamental analysis should be enough for you.
