5 Handpicked Sectors For You

There are two major strategies that are usually employed when investing in equities—the top-down and the bottom-up approaches. The top-down approach starts with a macro perspective and then analyses the micros. The bottom-up approach focuses on the stock itself. However, there is no definitive answer on which one is better. Each approach has its advantages in specific situations and the skill of the stock picker lies in knowing when to apply each method. Typically, the top-down strategy works better in volatile times, like in the current situation, when external factors have a greater bearing on the performance of one’s portfolio. This strategy works on the economy-industry-company model. When one approaches the market with the top-down strategy, one analyses the economy and then moves to the industry or sectors which will get impacted. To give investors a perspective about...