Feb 18, 2024 By Edward Weston
The stock market has the characteristics of both high profitability and high risk, appropriate stock analysis is constructive to improving profits, so how much do you know about stock analysis? From the technical point of view, we can naturally sum up a lot of reasons for the failures of shareholders. Just from the perspective of human nature, and with the method of psychological analysis, let’s see how the general stock investors in the stock market will encounter the fate of failure.
The basic analysis mainly analyzes the small environment of the company. The change of the big environment is good material to talk about, but it’s not practical for stock speculation. It is necessary to study the operation of the company in the small environment. With my own experiences, if I only rely on the trend chart to speculate stocks, and do not know what the company is doing and how it is doing, my heart is uneasy.
What factors do you think cause investors to enter the market to buy stocks? Wall Street has investigated that the main reason for average investors to buy stocks is that the stocks are rising rather than having a low cost-benefit ratio or high dividends! Similarly, the main reason that investors sell stocks is because the stocks are falling! It's falling! Keep in mind that when all people on the streets talk about how easy it is for the stock market can make money, the market is often at or near its peak. Everyone has put money into the stock market, and the driving force for the stock market to continue or to rise has dried up. And when the public is afraid, all that should be sold has been sold, and the decline of stocks is not much worse.
The knowledge of analyzing the rise and fall of stocks and why they rise and fall can be roughly divided into two categories:
A: Fundamental analysis
B: Technical analysis
Technical analysis studies the relationship among stock price, time and trading volume, it is also graphic analysis. Others belong to the category of basic analysis. Don't separate the two kinds of analysis completely, they are actually related. Among stock price, trading volume and time we see in technical analysis actually reflects investors' views on the operation of the company. They used their own money to vote for the future of the company. Another important knowledge closely related to stock speculation is how to determine the stock market, that is, the general trend of the stock market. In order to succeed in stock speculation, the ability of judging the market is essential. A bull or bear market is a big market. The rise of a big market is called a bull market, and the fall of a big market is called a bear market.
Basic analysts believe that: for the long-term, the price of the stock depends on the company's fixed assets and profitability. Therefore, any factors affecting fixed assets and profitability are within the scope of basic analysis. There are so many of these factors. Here I will list some of them and explain their impact on the stock price. I divide them into two categories: big environment and small environment. Big environment refers to the factors outside the company, and small environment refers to the factors inside the company. In addition, we will analyze the three factors that are most likely to lead to the rise of stock price.
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