Fundamental Analysis? I’m a Trader Skilled in the Use of Technical Analysis, Now What?

Fundamental Analysis? I’m a Trader Skilled in the Use of Technical Analysis, Now What?

A new legion of young stock traders is amassing out there, whether they are buying cryptocurrencies or trading stocks on Robinhood. I’ve been trading and investing in stocks since 2007, so I’ve seen the changes going on in the last couple of years. And I try to keep an open mind and adapt, or roll with the punches, if you will. You have to, in order to survive on the Stock Market.

My experience has always been with technical analysis and studying stock charts. I’ve always worked off of a trading platform, but I did start off by just going on a brokerage’s website to buy and sell stocks, using their web-based options. Then I graduated to their dedicated trading platform, a downloadable application that streams the data. Eventually, I had to step up to a 1 gig broadband internet account, and I had to buy a fast laptop and multi-gig cable modem and router. So, 99% of my trading and investing in stocks has been done using a standalone trading platform utilizing technical analysis. I have read several books and studied websites and youtube videos on how to do technical analysis, but in the end you have to develop your own style and your own system for picking stocks, when to enter and when to sell them in order to make a profit.

But now, I’m intent on learning Fundamental Analysis, getting into the skill of value investing, and looking to a broader 5 year investment time frame. And this involves buying publicly traded companies that have been evaluated to be cheap compared to its intrinsic value, or the overall worth of the company.

I’ve noticed that many traders and investors think in either one way or another, and I think it’s inherently wrong thinking. For example, value investors seem to always criticize day traders. And I personally see nothing wrong with using both strategies. As a matter of fact, I see nothing wrong with having one brokerage account set up for day trading and scalping, and another account for value investing. Sky’s the limit.

So, anyway I just wanted to put it out there that I’ll be focusing some attention on value investing and developing a skillset to strategize and implement a plan to learn and understand the art of fundamental analysis.

Fundamental analysis (FA) is a method of measuring a security’s intrinsic value by examining related economic and financial factors. … The end goal is to arrive at a number that an investor can compare with a security’s current price in order to see whether the security is undervalued or overvalued.

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randomguru

Portfolio Manager & Musician

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