Now, we understand the two types of research viz. Fundamental Research and Technical Research to analyze data for share market investments. Let’s explore the key points that differentiate these two types of research.
The basic difference between Technical Research and Fundamental Research is that FA tries to find reasons for a stock to move up or down and based on the reasons predicts the price movements whereas TA is not concerned with the reasons and it believes that the way a stock price moves currently tells you where it is heading for in the future.
|Fundamental Research||Technical Research|
|• Study and analysis of reasons for stock market movements using historical data, news reports etc.||• Study and analysis of price patterns and share volumes|
|• Financial reports are analyzed with the help of ratios||• Charts to understand share market trends are used|
|• Useful for long-term traders||• Useful for short-term trader or the ones who switch between short-term and long-term trade|
|• Uses expectations vs actual outcomes for analysis||• Uses trendlines, support and resistance etc. for analysis|