Stock Index Traders Must Understand The Difference In Fundamental And Technical Analysis

As an investor, profit is of course the main goal you want to achieve. For this reason, investors need to recognize the shares to be purchased by performing various analyzes such as fundamental and technical analysis. However, what is the difference between the two, and which analysis is better used? Fundamental analysis is an analysis based on the condition of a company, economic conditions, and related industries. Fundamental analysis generally uses company indicators listed through company financial reports such as Price to Earning Ratio (P / E), ROE (Return to Equity), and others. The world’s leading investor, Warren Buffet, believes in fundamental analysis when making investments. Fundamental analysis is often used by long-term investors to filter out stock indexes like NAS100 that are in the good category. Besides that, if you also need more strategies to trade NASDAQ100 indexes, you can visit http://www.nas100brokers.com/strategy.html right away. That website helps you find trustworthy NASDAQ Brokers too.

Meanwhile, technical analysis is an analysis based on data about historical prices that occur on the stock market. In the application of technical analysis, predictions to buy or sell stock indexes are made by looking at historical charts of stock index movements. Technical analysis users are generally referred to as traders who make short-term investments such as investing daily. One of the most famous users of technical analysis is George Soros.

Then, which analysis is better to use?

Each analysis has its advantages and risks. Investors have their method in determining which shares to buy. Technical analysis is a good method for analyzing current market conditions and investing in a short period. Meanwhile, fundamental analysis voters are generally investors who have high confidence in the company’s business, which will determine the company’s price so that they are not affected by stock index price fluctuations in the short term and tend to invest in the long term. Besides, some investors choose to combine the two analyzes in making transactions. Ultimately, the best analysis to use in investing depends on the investment style of the investor himself.

Leave a Reply

Your email address will not be published. Required fields are marked *