Purpose?
Before carrying out financial/investment activities, it is very important to consider the purpose of the activities. In the financial industry, people usually regard goals as the type of financial activities. When carrying out different types of financial activities, we will use different models, consider different factors and have different emphases.
The purpose of consumption can be to set up children's education funds or buy high-end houses, or just to use the current surplus wealth to accumulate more wealth.
The purpose of understanding any financial activity is to predict the expected return of investment activities, as well as the maximum cost and risk you can bear. In addition, the biggest cost and risk you can bear is that after the worst happens, your wealth can also bear the expenses of your children's education in the first few years.
Once you have a macro purpose or plan, you need to analyze the specific equity and company in more detail.
Background?
Information about the company background is easier to collect. First of all, you need to know which industry the equity or company belongs to. Secondly, the specific products produced by the company. Third, understand the management members and their board members, and understand the risks that management may bring.
The main driving force?
The main driving factor is the direct factor that has the greatest influence on stock pricing, company income or profit. For the most common example, the share price of Apple's stock has a very close relationship with the sales of its mobile phone product iPhone, because since the release of iPhone, it has been Apple's main means of profit, and its status far exceeds other products (including iPad, MacBook and other products). In addition, the share prices of some social media companies are directly related to their active users. Snap's share price plummeted by nearly 20% because its active users did not increase significantly.
To find out the key driving factors, we should combine theoretical knowledge with real-world observation. Find relevant news and news through the Internet or any electronic application. Find out the main driving force of the stock price recognized by the market from the news and news.
When collecting information about these key drivers, listed companies are usually easy to collect. They will disclose price information to the public and have the responsibility to report key information and decisions to the market. In contrast, it is difficult for private enterprises to collect information.
extraneous element
In the financial market, it is important to consider both endogenous and exogenous factors. External factors come from different aspects. First of all, the performance of the financial market will certainly be affected by the macro policies of the government and the central bank;
Secondly, in the same industry, we need to know the competitive performance of the research company; Third, you need to know the suppliers of the research company; Fourth, we need to study the factors that affect the target consumer groups.
Build your own analysis.
Due to the complexity of financial market, there is no perfect analysis method. Therefore, we must adhere to one principle-"roughly correct" and avoid "precise mistakes".
The most suitable method is to use a method similar to social science research. Financial market is a part of society, and financial market phenomenon is also the result of social coordination. Therefore, quantitative analysis methods and other social science research methods should be the most appropriate analysis methods.
Social science research pays attention to the relationship between variables. When making investment, we can study the relationship between company value and its company structure and capital status, and find out whether they are positively or negatively correlated. To understand the specific degree of impact or avoid taking it for granted, it is necessary to get relatively specific values through quantitative analysis.
Different people will adopt different quantitative analysis methods in order to improve the accuracy of their own analysis and investment performance, but the logic behind them is the same strain.
certificate
For any argument or statement, the most important thing is to make the key points and conclusions prominent and obvious. In addition, it is also important to express the whole analysis process in logical thinking order. It is suggested that at the end, there should be a clear analysis result. The analysis report with clear layout will be better used in the future.