Introduction

Technical Analysis = the study of market-related data as an aid to investment decision making. 

Technical analysts believe that all useful information is already impounded in the price structure.

Therefore the best source of information is the price structure itself.

 

Fundamental Analysis = the study of company-related data as an aid to investment decision making.

Fundamental anaIysts estimate the worth of a share based on company and economic factors and compare their estimate with the market price.

If there is a sufficient discrepancy, they act.

 

In essence, technicians believe that the market is right, while fundamental analysts believe their analysis is right. 

 

Rational Analysis: The juncture of the sets of technical and fundamental analysis. 

 

It is important to keep in mind that the stock is not the company and the company is not the stock.

Though there is a reIationship between a company and its stock, the connective tissue between the two is primarily psychological. 

 

It is the combination of technical and fundamental analysis that best paves the road to investment success.

Employing such a combination creates an environment within which:

- the investor/trader can make rational decisions.

- emotions can be kept under control. 

 

Emotions are the investor's worst enemy.

Did you ever sell into a panic, buy at the top, wony about being caught in a bear market, or fear missing the next big bull run?

Rational Analysis can help you avoid those traps by giving you a reasonable basis to make fully informed decisions.

Then, instead of being a member of the crowd, swayed by greed and fear and making the same mistakes time and again, you can hold your head up high as an independent investor acting in your own best interest. 

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