Personal Finance

Invest with a Strategy

INVESTMENT STRATEGY

Lets have a look at the first investment strategy that the investment world has to offer;

Top-down investing

Top-down investing is an investment approach that involves looking at the “big picture” in the economy and financial world and then breaking those components down into finer details. After looking at the “big picture” conditions around the world, the different industrial sectors are analyzed in order to select those that are forecasted to outperform the market. From this point, the stocks of specific companies are further analyzed and those that are believed to be successful are chosen as investments.
Breaking it down

An investor may use different criteria when deciding to employ the top-down approach. For example, an investor may consider such factors as geography, sector, and size. What is important with this approach is that a big picture perspective is taken first before looking at the details. Although there is some debate as to whether the top-down approach is better than the bottom-up approach, many investors have found the top-down approach useful in determining the most promising sectors in a given market.
Next we will look at bottom-up investing.

 

 

 

 

 

Source: Investopedia

IM Source: www.finance.zacks.com

Join the discussion

  1. leroy

    Im grappling with investing

  2. Lindani

    Black people need to invest more

  3. Andrew

    Simple>!<

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