When looking for possible investment assets, a wide range of choices is offered to you by the market. You may pick bonds, pieces of art, real estate, currencies, commodities, derivatives, or probably, the most well-known asset class, equity. Equities represent ownership right over a certain part of the given firm (issuer).
However, which shares shall we buy? When should we purchase and sell them? These decisions are of key importance as they will determine the return on your portfolio. There are two different views out there on these problems.
Technical analysis is built on historical price developments and believes that certain patterns may be identified that help predict the future movements of the quotes. Fundamental analysis, on the contrary, focuses on the firm and the value of the ownership right itself rather than on the market price of it. Here, we believe that sooner or later, market price has to reflect the fair value of the share that can be calculated...