Research & Analysis Basics

Learn the basics of fundamental and technical analysis to make better trading decisions.

6 min read

Why Research Matters

Trading without research is like driving blindfolded. Understanding a company, its financials, and its market position helps you make informed decisions instead of gambling.

Fundamental Analysis

Fundamental analysis looks at a company's financial health and business quality. Think of it as checking whether the company itself is good. Key things to look at:

•Revenue — How much money the company makes •Earnings (EPS) — Profit per share •P/E Ratio — Is the stock cheap or expensive relative to its earnings? •Debt — How much the company owes

📌

P/E Ratio

Price-to-Earnings ratio. Calculated as Stock Price ÷ Earnings Per Share. A lower P/E may suggest a stock is undervalued; a higher P/E may suggest it is overvalued or fast-growing.

Technical Analysis

Technical analysis studies price charts and trading patterns to predict future movements. Instead of studying the company, you study the stock's price behavior.

Common concepts include: •Trends — Is the stock generally going up, down, or sideways? •Support & Resistance — Price levels where stocks tend to bounce or stall •Moving Averages — Smoothed price lines that show the overall trend direction

📌

Support Level

A price level where a stock tends to stop falling and bounces back up, because buyers step in at that price.

📌

Resistance Level

A price level where a stock tends to stop rising and pulls back, because sellers step in at that price.

Using STONX Research Tools

STONX gives you powerful research tools right here in the Research section:

•Market Center — See live index data and market overview •Big Movers — Find stocks making the biggest daily moves •Screeners — Filter stocks by price, volume, market cap, and more •Watchlist — Track stocks you are interested in

💡

The best traders combine both fundamental and technical analysis. Use STONX's Research tools to practice analyzing stocks before you trade them in games!

ℹ️

Congratulations — you have completed the STONX Learning Series! Head back to the Research page and start exploring the market with your new knowledge.