Money managers need to be smart for their investment decisions. Following mentioned are the three basic investment strategies that usually fund managers’ use for smart investment analysis:
1- Fundamental analysis
This is a type of investment analysis that investment managers use for evaluation of the different factors which have an impact over the performance of an investment. When it’s about analyzing a specific kind of stock, the analysis will contain overlooking all the aspects of the financial information of that particular company including its level of debt too.
Moreover, this analysis will hold meetings with the top executives, employees, customers, competitors and the suppliers of the company. You need to analyze the management of the company to know how successful your investment will be.
Fundamental analysis is also called technical analysis. This type of report includes selecting the assets for investments based on the trading patterns they possess.
Most of the fund managers have their focus on technical analysis of the stocks because this lets them know about the areas from where they can drive growth.
If a specific stock stands good in its fundamental analysis, more are the chances for it to remain stable throughout the investment.
2- Contrarian investment
It is another type of investment analysis used by most of the managers. Contrarian managers usually select those assets which remain out of any favours. Such fund managers determine the consensus of the market for a specific sector or company. They have such robust evaluations that they then have bets for it.
This style of investment called a value investment strategy in which investors purchase assets which undervalued for any statistical reason. It is one of the most successful types of finance, but an investor should choose the right asset assessing the correct period. Wrong bets can result in failed investments.
3- Dividend investment
It is the purest form of investment generally preferred by the fund managers. In dividend investment, investors buy the stocks that have good records of dividends and earnings. This type of investment is favorable to the investors as it guarantees them a regular payout.