Jakarta –
Investment in the capital market promises abundant supply. In addition to the benefits of capital gains or increased share value, capital market investors can also benefit from dividend distribution.
But keep in mind, stocks are an investment instrument that has a high risk. What’s more, when the economy is in turmoil like in the current pandemic.
In stock investing, a person can experience a risk of loss which is called capital loss. Therefore, in investing in stocks, especially for beginners, it is necessary to first understand this risk and need to know two ways to analyze a stock, namely fundamental analysis and technical analysis.
Fundamental analysis generally emphasizes the analysis of a company’s performance. We analyze things that can move stock prices such as macro policies, micro policies, financial reports, industry potential, and the level of business competition and the company’s future business model.
In fundamental analysis, there is a top down analysis approach. Top down analysis looks at the big picture in advance of the companies whose shares we will buy. Through this approach, an investor can find out whether the condition of a company is generally good, and whether all components of the company can be considered good or vice versa.
Lifepal.co.id provides an overview of 4 things in the top down analysis approach in conducting fundamental analysis, along with the explanation:
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