As the title said, do you use a top-down or bottom-up approach for investing?
- Top-down
- Bottom-up
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voters
Top-down investing begins with an analysis of the broader macroeconomic environment and then narrows down towards individual assets or securities.
Bottom-up investing begins with a detailed analysis of individual stocks or securities, assessing their fundamentals, financial performance, and growth potential, and then using this information to make investment decisions.
If you are a top-down investor, what economic indicators do you looked at? For example, interest rates, geopolitical events, inflation, commodities prices etc?
If you are a bottom-up investor, what do you focus on? Growth, debts, return on capital (ROIC), technicals, or ratios like P/E, EV/EBIT etc?