Fundamental Analysis & Chartering via Automated Stock Trading

By: Russell Clark

Perhaps the most important attribute of the canny investor is a sense of timing - knowing when to purchase the stocks and when to sell them. We all know the old saying “Buy Low and Sell High", but how do we know when the price is low so that we can buy; or when the price is high, so we can sell? There have been many theories and techniques which have supposedly guided the investor over the years. Traditionally, these theories fall into two general categories: the Fundamental Analysis and Chartering. Fundamental Analysis is all about understanding the nature of the underlying asset so that the investor can make an informed investment decision.

The analyst will pours over the company’s financial statements, analyze the profitability of the market the company operates in, and make an assessment of the calibe of the management team. Chartering – or technical analysis – takes a different approach. There is absolutely no focus on the company itself. Instead the investor analyses the movement of the stock price over a period of time. The theory is that “everything is factored into the price", and the stock price alone will predict the Buy and Sell signals. Investors have traditionally adopted one of these two approaches. But now, with the advent of increased computer processing power and intelligent algorithms, the investor can get the best of both worlds by using Automated Stock Trading software. Some examples of Automated Stock Trading software packages are StockPicker from Investing Systems Network or OmniTrader. Additional information can be found at www.autostocktrading.com. Automated Stock Trading software enables the investor to robotically monitor the market for Buy and Sell signals, as per the Chartering model. But it also accommodates the Fundamental Analysts by evaluating the company behind the stock using its proprietary algorithms and “fuzzy logic". Best of allScience Articles, it then executes the trades when all the conditions are met!

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