The Fundamentals of Stock Analysis | Stock Analysis Explained



The Fundamentals of Stock Analysis | Stock Analysis Explained

Learning to analyze a stock is just the first step in your investor journey. Learn how to do it like a pro with Titan's Christopher Seifel.

Video Transcript

So, stock analysis is the evaluation of the market as a whole, industry and specific company to determine the prospects of investing in that company's publicly traded shares. Most think of this process as purely quantitative. However, the role of uniquely human capabilities extends beyond just analyzing data. Investors combine an understanding of human behavior with past and current data in order to gain an edge in the markets and make informed decisions. One of the edges that Titan focuses on is a long term investment horizon.

There are two basic types of stock analysis fundamental and technical. Fundamental analysis is the process of estimating a company's intrinsic value by using a variety of resources such as financial records, company assets, market share, current debt levels, current financials, just to name a few. Technical analysis takes into account past and present price action of a company along with market moving, supply and demand factors to make an assessment. When talking about generating above average returns, people often talk about having a differentiated view from the market.

The hard truth, however, is that the consensus is often right. Economist John Maynard Keynes famously analogized market analytics to a beauty contest, in which you are just trying to figure out who everyone else thinks is the most beautiful. 

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