Regular analysis of stock market ensures maximization of wealth and minimization of risk
. Be it IPO research, mutual fund analysis, or analysis of a particular stock; internet is a must now-a-days to get best results. Stock related news and magazines also help in such analysis.
Fundamental Analysis
Fundamental analysis of stocks is a technique whereby the investors investigate the financial statement of companies whose shares they are interested in. Mutual fund research through fundamental analysis would include investigating about the typed of funds your mutual fund company invests in. This will help you to find out what all industries do you company targets for investment. You should also try to find out the investment psychology of your mutual fund company.
Technical analysis of stock is where the investors use quantitative methods and charts to find out the overall price trends in the stock market. This helps them to estimate the probable future price movements. Company's financial statements do not play a great role in such analysis. Advance-decline line can be used to distinctly see the upward or downward movement in prices of various stocks.
Comparative Analysis and index method
In this type of stock analysis, you can compare various stocks and try to figure out which stocks are already performing well and which stocks are anticipated to do well in future. This will help you to decide what all stocks you can buy, hold, or sell. Index method is a technique whereby the concept of market capitalization is used to value your portfolio. Stock analysis software can also be used for analyzing stocks. This is an analysis that will help you to make the most diverse portfolio. It will further help you to save taxes, maximize your wealth, and minimize your risk.