click here to register: http://goo.gl/nMzvG6 <br />http://ncfmacademyhyderabad.in <br /> <br />Fundamental Analysis of stocks explained <br /> <br />Fundamental Analysis is a technique to find out how strong the working of the company is, what kind of valuation it deserves, what price it must have and is the company right for buying its shares. <br /> <br />Before buying any business, you must know if it is fundamentally strong or not? <br /> <br />The important parameters that you have to look at are: <br /> <br />Market Capitalization – It is the net worth of the company. <br /> <br />It is Total outstanding shares into the Share price it quotes. <br /> <br />According to the Market Capitalization, companies are classified into different categories: <br /> <br />Large-Cap stocks: Market Capitalization is more than 10,000 crore <br />Mid Cap stocks: Market Capitalization is more than 1000 crore. <br />Small Cap stocks: Market Capitalization is less than 1000 crore <br />Micro Cap stocks: Market Capitalization is less than 100 crore. <br /> <br />Whenever you feel that the network of the company is much more than its Market Capitalization, then that company is good for investment. <br /> <br />Whenever a person’s net holding value of any business is at least 51% of its current Market Capitalization, then that company becomes his own company. <br /> <br />Important Note: The risk is minimum when the Market Capitalization of the company is more and the risk increases when the Market Capitalization of the company decreases, at the same time: Multibagger returns can be expected from little Market Capitalization companies but from large cap companies one can expect only moderate yields. <br /> <br />Multibagger: It means multiples of return, 2 baggers is doubling your return, 10 bagger is ten times over the period of time. <br /> <br />Investment point of view <br />Short Term means 3 months to 12 months <br />Medium Term means 12 months to 36 months <br />Long term means 3 years to 10 years <br /> <br />Longer is the holding term of the stock, safer it is for the investment, and it is very likely to give good returns. <br /> <br />Reference site for Fundamental Analysis of the company: <br />moneycontrol dot com .type your company name in the ‘Get Quotes’ box. <br /> <br />P/E means Price / Earnings, also called as Price-Earnings Multiple. It is the Market Capitalization of the company divided by the net profit of the company in the latest financial year. <br /> <br />In India, Financial year means From April 1 to March 31 <br />In the US From Jan 1 to Dec 31.
