All about investment

So are you more of a technical or fundamental investor?

A technical investor will simply rely more on stock chart patterns to decide when to get into or out of a stock. Of course the problem with this approach is it is by no means full proof. Although many investors like to talk about chart patterns the truth is they are very unpredictable. If you just base your stock picks on chart patterns alone you will probably have quite a few poor trades.

A fundamental investor tends to be more of a long-term investor who looks at the underlying variables related to a particular stock such as the earnings and profits. The one big problem of only using fundamentals is that many times a fundamental investor is relying on future estimates related to a stock which can be very inaccurate. Another issue is that investors have to rely on numbers being provided by a company; which are not always displayed in a truthful manner.

So which method is better?

Well a technical investor is probably a bit more of a risk taker than a fundamental investor. However, the rewards of a successful short-term technical trader can greatly outweigh those of a long-term fundamental trader. This is because short-term technical traders try to only catch the upswings in the market while eliminating the downswings. Where as fundamental long-term traders tend to hold onto stocks during both the upswings and downswings in the market.

With all things considered the best method for being successful in the stock market is simply knowledge and experience. When you first start out you will definitely find out there is more to investing in stocks than buying low and selling high.