Options Made Easy: Your Guide to Profitable Trading, Second Edition

The Wider Economy

Before delving into an individual company’s fundamentals, we need to take a brief look at some basic economics. Those of you who have previously been scared of economics, don’t be here! In the overall scheme of things, we’re just talking common sense here, and a good place to start is with the country at large and the wider economic climate. This is called taking a “top-down approach.” It means we are looking at the broader picture—in other words, how is the general economy performing? Are any storm clouds looming? This is a sensible approach and your success will depend on keeping your senses alive and alert to what is going on around you anyway. It really doesn’t take much; just keep up to date with the news, and you will ...