CHAPTER 13Fundamental analysis

So far, we have discussed some of the mechanics of buying and selling shares, and covered some of the reasons for developing an investment strategy when creating a diversified portfolio. For those investors who like to undertake their own analysis or want a better understanding of how their adviser may make an individual share recommendation, this chapter and the next one will introduce two broad approaches to share analysis: fundamental analysis and technical analysis.

Fundamental analysis is the study of the various factors that affect a company’s earnings and dividends, as well as the impact on the relative safety of an investment in a certain company due to the relationship between its share price and the ...

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