Stock market analysis

types of stock market analysis

Why to analyze stocks?

What is the "best" way to invest. This discuss three types of market analyst and how one can understand investment from a "big picture" perspective.

Security Analysis: Does it matter?

Various roles in the market

• Analysts are hired to find undervalued stocks.

• Strategists are hired to predict the direction of the market and various sectors.

• Portfolio managers are hired to put it all together and outperform their benchmarks, but 75% of equity mutual funds underperform the benchmarks.

There are different ways to analyze the market:

• Fundamental analyst

  • believes that analyzing strategy, management, product, financial statistics and many other readily and not-so-readily quantifiable numbers will help choose the stocks that will outperform the market.

  • They are likely to believe that there is a little to no value in analyzing past prices and that technical analysts would be better off stargazing

• Technical analyst

  • believes that chart, Volume, Momentum and array of mathematical indicators hold the keys to superior performance

  • likely to believe that fundamental data is complete hogwash

Are Markets Efficient?