Lauren Hua

Differences between value investing and technical investing

There are different types of strategies investors can use to trade on the stock market. Two common strategies are value investing and technical investing.  Value investing is a strategy where the intrinsic value of a stock is evaluated and stocks are brought using fundamental analysis. Value investors like to buy stocks that are underpriced in the market. Technical investing looks more at the price action of the stock. By analysing price movements investors can weigh up the probabilities that a …

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What is a stock split and why do they happen?

Apple has recently announced they will be undertaking a stock split. In this article we discuss the definitions and the reasons behind this. What is a stock split? Stock Splits can come in many ratios but the most common is a 2 for 1 stock split. These corporate actions occur when the board of directors decide to increase the amount of shares outstanding.  If a company had 50 million shares outstanding prior to the split, the corporate action will increase …

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Important Financial Ratios

Each Tuesday we produce a research document called “The Dynamic Investor” where we analyse various stocks fundamentally as well as technically. Each stock which is covered also has 5 fundamental metrics. Whilst there are many other important metrics that investors need to understand, these 5 are a good starting point. In this article we explain what each metric means and why they are important when analysing stocks. Market Cap A market cap (“market capitalisation” in full) of a stock is …

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What you need to know about shorted stocks

The shorted stock is a term which is used frequently in the share market. In this article we explain what this term means and why this strategy is used. What is short selling? A short selling strategy involves selling a stock to profit from a fall in the share price. The way traders do this is they borrow the stock they want to short sell, then they sell this stock in the market. Eventually they return the borrowed stock to …

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How do you know a stock is expensive? Part 3

Company’s enterprise value to earnings before interest, taxes, depreciation, and amortization. In addition to the P/E ratio and PEG ratio, investors can also use enterprise value to EBITDA to evaluate whether a company is expensive or not. Enterprise value can be defined as the cost of the company to another investor who would want to buy it. In our previous analysis in determining whether a company is expensive or not, those ratios did not take into account debt but the …

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