Investment is an art. Different investment methods are used by investors and traders in the market and somehow there is no such method as a holy grail. But one thing among them are the same, they are here to earn.
For me, investment is almost the same as conducting your own business. I am a support of long term investment strategies. Careful analysis on internal factors (such as business model, competitive advantages, human resources and so on) and external factors (such as competitors, industry of the business, health of a country) , believing own strategies and be patient for the return . If you follows my blog, you will notice that my analysis inside here is mainly based on the top down approach.
Firstly, Macroanalysis. Start from analysing global environment (Focuses more on constantly update myself with news and apply logic thinking to them) to Malaysia environment ( Focuses more on news update, FBMKLCI technical analysis, and MSCI Malaysia Index Fund analysis). Because of limited resources in term of money, time and knowledge, I am only focusing on Malaysia environment currently.
Secondly, Microanalysis. Start from analysing industry ( New updates about the industry and industry index technical analysis) to particular company (New updates about the company, fundamental analysis and technical analysis). Both of these, I will be focusing in finding the growth potential of that particular industry and company in it (Normally in a 5 years perspectives).
From various kind of technical analysis available, below are few indicators which I am currently using:
1)Volume spread analysis (focuses in interpreting price spread and volume changes, always in use)
2)EMA(s) (for interpreting trend, always in use)
3)MACD (as a confirmation for volume spread analysis, always in use)
4)OBV (as a confirmation for volume spread analysis, rarely use unless the 1-3 indicators can give me a clear picture)
5)Chart pattern (always in use)
6)Psychological support and resistance (always in use)
For fundamental analysis (normally analysis will be the newest 3 years statements), there will be few part I will be heavily focusing in, below are some of them:
1)Chairman statements (to identify the trustworthiness of the company from the promises in the past)
2)BOD of the company
3)Statements of company(mainly vertical and ratio analysis)
4)Changes of shareholding
5)List of properties(mainly on property and reits company)
That's briefly my ways in investing.
Happy investing, all! =)
