Fundamentals & Technicals
Fundamentals tell you what. Technicals tell you when.
What This Means
Should you use fundamental analysis or technical analysis?
We believe the answer is both. Fundamentals help us decide what to own, while technicals help us determine when to buy, sell, or wait. They answer different questions, and we believe investors make better decisions by using both together.
Fundamental analysis focuses on the business itself. It looks at factors such as earnings, cash flow, revenue growth, competitive advantages, and valuation to help identify quality investments.
Technical analysis focuses on the market. It evaluates price trends, momentum, and investor behavior to help determine whether the timing appears favorable.
Many investors believe they have to choose one approach over the other. We disagree. Ignoring either fundamentals or technicals means ignoring valuable information.
At PureVest, we combine both. Fundamentals help us identify investments worth owning. Technicals help us decide when the odds appear to be in our favor. Together, they provide a more complete investment process than relying on either one alone.
Common Questions
Why do technicals matter if a company is fundamentally strong?
A great company isn’t always a great investment at every point in time. Technical analysis helps us understand market trends and investor sentiment before making a decision.
Can technical analysis predict the future?
No. Technical analysis doesn’t predict the future. It helps identify trends, momentum, and probabilities. Like every investment tool, it should be used alongside other information—not in isolation.
Why do some investors ignore technical analysis?
Remember This:
Don’t ignore half the information.