Techniques to know before you start investing in the stock market

Techniques to know before you start investing in the stock market

Do you already know the fundamentals of the stock market, but haven't yet worked up the courage to start investing? Perhaps we still need to understand how to do this in practice. You check out what needs to be done to get started applications and which strategies are most suitable for each investor.

Equity Investment Strategies

There is no single way to invest in stocks. In fact, there are a multitude of different techniques and strategies for working with variable income. The most suitable choice depends on the investor's profile and objectives, but also on timing and market conditions. Find out about some of the most common strategies below:

choosing and analysing stocks

To be successful in the stock market, it is imperative to conduct an investment analysis. It is used to present scenarios about future stock prices, which can help investors make their choices. It is on the basis of an investment analysis that brokers recommend buying or selling shares, for example. There are two main types of analysis applied to the stock market: technical and fundamentalist. Know the details of each:

Technical analysis

Technical analysis assumes that the information about a stock is expressed in its price chart. After all, the value for which a paper is bought or sold reflects the perception that analysts, professional investors, individuals and the rest of the market have about it. Thus, observing the curves of the stock price chart allows you to identify patterns and estimate behaviour in the future.

Fundamental Analysis

Fundamental analysis is based on the study of a company's financial characteristics, growth prospects, cash flow and risk, to determine the potential value of its shares. The objective is to enable the investor to choose stocks that have good prospects for future gains, avoiding the purchase of stocks that are already listed at a value very close to their potential. There are two forms of fundamental analysis. Top-down analysis assumes that the value of a stock is directly influenced by macroeconomic factors. In bottom-up analysis, however, the starting point is the individual foundations of each company.

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