fundamentalianalyysi

Fundamentalianalyysi, often translated as fundamental analysis, is a method of evaluating securities such as stocks and bonds by attempting to measure their intrinsic value. This intrinsic value is calculated based on an examination of relevant economic, financial, and other qualitative and quantitative factors. Fundamental analysts believe that the market price of a security may deviate from its intrinsic value, and that by understanding these factors, they can identify mispriced securities.

In the context of stocks, fundamental analysis involves looking at the financial health of a company. This includes examining financial statements like the balance sheet, income statement, and cash flow statement. Key metrics such as earnings per share, price-to-earnings ratio, debt-to-equity ratio, and dividend yield are scrutinized. Analysts also consider the company's management, its competitive landscape, industry trends, and overall economic conditions. The goal is to determine if a company is undervalued, overvalued, or fairly priced.

For bonds, fundamental analysis focuses on the creditworthiness of the issuer and prevailing interest rates. Analysts assess the issuer's ability to repay its debt, considering factors like their financial stability, revenue streams, and economic outlook. The yield on a bond is compared to prevailing market interest rates and the yields of similar bonds to determine if it offers an attractive return relative to its risk. Ultimately, fundamental analysis aims to provide a reasoned basis for investment decisions by understanding the underlying value of an asset rather than relying solely on market sentiment or technical trading patterns.