Fundamental Basics 101

Many people disregard fundamental analyses as it is "difficult to learn" so they start using technical analyses.

The question really is: what is your trading edge over others? Everybody can use technical analyses these days. All you need is a click of a button and you have a technical study drawn for you. You don't even need to understand how to calculate it these days, it is so easy to use.

So are you sure that technical analyises is enough for a trading edge?

The basics

Fundamentals simply mean that underlying foundation on which other things built (for example the price of the share).

If a company keeps growing, the price will grow above every limit no matter what a graph shows. If a company keeps making greater and greater losses and shrinking, no level in price is low enough to "support" it.


Fundamental analysts tend to invest on the long-term because on the short term greed and fear changes the price. That is supply and demand changes the price. But it is fundamentals (the basics) are need to support a price.

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