Investing For Beginners: Fundamental vs Technical Analysis


There are two types of investors: Those who look at number and those who look at charts.

Fundamental analysis means looking at numbers and try to find the intrinsic value of a company. There are several numbers which can be used but the goal is to find a difference between the intrinsic value and the market value. If the intrinsic value is lower than the market value then it means that it is a good investment.

In technical analysis, the market value of a company is equal to its intrinsic value. The technical analyst believes that all the fundamentals are taken into consideration in the market price and, therefore, not that important. Instead, they look at charts and look for patterns and trends.

Most investors are a combination of both. I am 95% a fundamental analyst and 5% a technical analyst.

Here are some sources from where you can get information: yahoo finance, CNBC, Bloomberg, Bloomberg Terminal, Investing.com, Gurufocus, TradingEconomics, MarketWatch, Fidelity.com, Zacks.com, EDGAR database on SEC website, Investor relations page of any company.

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