Trading Financial markets - Fundamental Vs Technical analysis: Pros and Cons for differentinvestment styles

Abstract

Financial markets offer investors a multitude of analytical techniques to make informed trading decisions. This paper investigates the merits and drawbacks of two core approaches: technical analysis and fundamental analysis. Technical analysis centers on the study of historical price patterns and charts to anticipate future market trends, while fundamental analysis emphasizes a company's financial health, industry dynamics, and macroeconomic factors to assess its intrinsic value. The relative efficacy of each approach depends on factors such as the investor's risk tolerance, investment horizon, and market conditions. This paper aims to provide a comprehensive comparison of these approaches, equipping traders and investors with crucial insights for optimizing their investment strategies.