Fundamental Analysis of Stocks for Programmers and Beginners

The crucial accounting and finance topics you need to know to invest like a seasoned professional in 11 minutes

Fundamental analysis and technical analysis should be familiar terms if you have ever dabbled in the stock markets. Technical analysis is defined by using statistical trends from historical trading activity, and other datasets to identify future trading opportunities. Many data science specialists believe that this is the way to do it, and there are many companies built around this ideology. On the other hand, analysts who believe in Fundamental analysis believes in finding a company’s “true” intrinsic value, through analyzing its financial statements. Warren Buffett has stood behind this methodology time and time again, betting that long-term value investments generate the best investment returns.

I’ve seen the strengths and weaknesses of both ideologies. Buffett, who has made a fortune through his investment holdings, has recently seen cracks and losses. Airline stocks have taken a nose-dive after Berkshire Hathaway sold them all in April. Warren Buffett makes mistakes, and unanticipated events occur, but he has also made his fortune using this ideology. Technical analysis also produces insane returns, such as the 70% average annual returns from the Medallion Fund of Renaissance Technologies.