Fundamental Investing in asset classes considering economic climate

Abstract

Fundamental investing is based on three principles first one is emotional aspect which is
coming into the focus because of various investors' behavior and also bias towards the
assessment. Second it is also based upon the fundamental economic value of a particular
asset, to understand basic aspect of the share one need to first differentiate or discriminate
between these two aspects. The discrimination of psychological part and the economic value
part comes with lot of expertise and requires analysis of an industry as well as particular
asset. Apart from this ,if an investor buying with lower price compared to intrinsic value
there is more possibility to accumulate wealth or in other words the possibility of higher
Returns are more. The difference between particular asset price and its intrinsic value is
called as margin of safety. To summarize fundamental investing is based on psychological
aspect, intrinsic value and price at which an asset is available during the time of purchase.
To differentiate fundamental investing from the other class of investing, one has to list the
investing methodologies or need to classify the investors based on various parameters such as
time period, approach towards the economics and Finance in general. Based on the time
horizon the classification is long term, short term and traders. To define the term long term is
considered for 10 years time. Short term is range from months to less than 3 years, the
positional trading between weeks to months less than 1 year and day traders trade within a
day.