Fundamental vs Technical Analysis

Today we're looking at fundamental analysis vs technical analysis. We are going to talk a little bit about each of them compare and contrast the two methods. 

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Fundamental analysis combination of the two in different ways.  Approaching that message from the perspective of equity in Vesta. Is fundamental analysis prices. So why not investigate the economic nuts and bolts on the company in order to work out whether it's cheap, whether it's expensive or whether it's the right value. So let's look at this age. I can only take this can come in the form of quantitative information or qualitative information means the hard numbers things that can have to be counted as the name suggests it to do with quantity. Where is qualitative?

if you like and as the name suggests this has to do with the quality of the company the essence of Bubba illustrates these two times. So some examples of qualitative information me things like the brand value of brand recognition and the management of the company that people are actually running it what that track record is what they have to say about where the company's going and then some examples of quantitative information have dividends and earnings sales and Book value things like these and then we got to compare these pieces of information to price with won't be cool valuation ratios a price-to-earnings price to sales Price to Book value, and I thought you made a series a video to do check those house. If you want to learn more about each of those valuation ratios of information these together

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About what is yet to come when we talked about looking at what price is doing in has been doing recently. This is basically what we refer to section some key things like support and resistance Trend trend lines price breakouts things like that do check out my video on the reasons behind support and resistance. If you want to learn more about those recognizing price action, we have a host of technical in the cases available to us. You'll find all the key ones in trading to unseized app things like moving average. And also I use his pictures of volatility and buy volatility remain how much price has been moving. So for all these things price action indicator. These are just looking at Price Chopper to the fundamentals.

I'm using the two different messages with fundamental analysis. One of the key assumptions is that the share price will reflect fundamentals in the long run and invested. I say that a company is undervalued and therefore buy shares in the company of a confident because it's based on hard data that it will end time increase in Valley, but we don't know when it tells us nothing about the timing only that we think eventually it's going to happen. So immature back that so much fundamental information available financial statements and analyst schools and balance sheets are in this announcement time is do is effectively you mean hooking up a lot of companies is time-consuming as we said in our intro.

Directions to fundamental analysis where is fundamental analysis economics driving price and things that fundamentally I was just don't look at trading signals and full my timing for investment. He's on the valley and that's what we know. We want to buy it might be able to help us find a time to buy it doesn't have to be in a situation in my experience and trade is do tend to use a combination of both even if they lean heavily in favor of one over the other even someone who's heavily in favor of technical analysis is unlikely to ignore the last company.

Looking at it the other way someone who is heavily in favor of fundamental analysis. Probably still going to cost the right overcharges to get a feel for what the company price has been doing my own personal perspective. I want to use all the tools that are available. So if there are any benefits to be gained from one of them to use it also in my experience, I would say that a longer-term investor is more likely to lean on fundamental analysis and taking it to an extreme pain manager who's stealing Investments and the other way very short time Traders my lean heavily on technical analysis. They tend not to be invested. So I swear she has someone go to the scalp.

For example Peck's Market with an in and out very very quickly. They might be dealing Cheerilee payment to use a combination in a bitmoji. So which to use in this diagram illustrates a sliding scale of usage from 100% and be a whole variety of mixes for more than I shouldn't have. This is just to give you a rough idea of what I'm talking about. I'm giving them some Abba tree outfit is that on the right as 100% fundamental analysis guy and then a heavy technician might make most of the decisions using technical analysis, but my keep an eye on things like to pay attention to Major macroeconomic releases has made up it represents half and a half maybe they use technical analysis to confirm the decisions that make you from looking.

Fundamentals, maybe they used as a way that entries and exits off of deciding what to do based on the fundamental and a casual charm is someone who heavily focuses on fundamental analysis, but might cause their I overcharge every now and then and I would say that we might describe these people on the left as being more like Traders and those on the right as being a bit more like invest is us doesn't necessarily have to be the case. Ultimately. It's up to the individual and the Golden Rule as always applies use what works for you what you think which method do you prefer to send us a message in the comment section. 

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