Monday, August 3, 2009
There are two main schools of stock investment: technical and fundamental analysis. Technical and fundamental analysis differ from each other greatly in that they are completely different ways of analyzing stock. Technical analysis deals with charts and trends, while fundamental analysis deals with facts such as financial statements, management, and geographical location of the business. Technical analysis is generally better for short term, while fundamental analysis is more appropriate for the long term. It must be noted that the world's richest investor is a practitioner of fundamental analysis. He himself advocates fundamental analysis, and he thinks technical analysis is silly. We will go into more detail about fundamental and technical analysis throughout this blog.