When you go to look for stocks to trade, there are two different ways of approaching the stock market...
Those two different ways of looking for a stock are fundamental analysis and technical analysis.
In other words from a “predicative” view or “reactive” view.
The guys doing fundamental analysis read tons of stuff.
They read all the company press releases, stacks piled to the ceiling of Wall Street analyst’s reports (what a joke) from every brokerage firm on Wall Street.
They read the company’s quarterly earnings reports (what a lie).
Ever read one of these?
These company produced quarterly reports and annual reports are filled with jargon and accounting language that nobody can understand and some of which seems to be totally made up. Like the “synthetic lease” found in one of Krispy Kreme Donut’s quarterly reports.
The fundamental analysts read all this stuff and more, etcetera, etcetera, ad nauseum...
From all these piles of crap they come up with calculations and stock price valuations to determine if a stock’s price is overvalued or undervalued and from there they try to “predict” the stock’s price movement.
Fundamental Analysis Is
A Total Waste Of Time!
There are two reasons fundamental analysis is a total waste of time.
#1. The reason is because you cannot rely upon any information you get from the company you are researching or from Wall Street analysts.
Before I found success as a trader I was trained as a stock broker on Wall Street so I’m telling you this as an insider –
Company Management’s Job Isn’t To Tell You The
Truth…. It’s To Get You To Like The Stock!
Same thing with Wall Street analysts, company management blows smoke up their skirt and the next thing you know the analyst’s brokerage firm is issuing a “strong buy” recommendation.
#2. Wall Street brokerage firms have already been busted for “conflict of interest” when it comes to recommending stocks. They would issue “buy recommendations” then talk amongst their peers and friends about what a piece of shit the company was.
Nobody On Wall Street Cares If YOU Make Money...
They Only Care If THEY Make Money!
You cannot trust any information you get from a company or from Wall Street!
Since you cannot trust any information from the company or Wall Street analysts, any time you spend on fundamental analysis is a complete and total waste of time...
Back in the old days... 1970's... 80's and 90's...using a stockbroker or fundamental research might have given you an edge...