Investing in Stock Market?

Out of curiosity, I went to attend a Technical Analysis Training Program Preview by a company that dealt with 'design, development and commercialisation of financial market solutions'. It was quite interesting indeed after the 2hrs session.

The speaker mentioned, basically in stocks trading, there are two main school of thoughts:

i) the Fundamental Analysis part where people believe in the true value of the company, analyze the P/E ratio, Balance Sheet, and many other ratios, then match whether the existing stock price is undervalued or overvalued.

ii) the Technical Analysis part where all these ratios are thrown out of the windows. It is simply chart trending and trying to predict how the movement of the stock prices. Because market shares are governed not only by fundamentals, but sentiments as well. History does repeat itself.

And thus there exist a third school that tries to combine the strengths of both Fundamental & Technical Analysis together.

From the preview seminar, the speaker also highlighted 3 common mistakes why people lose money, which I kinda agree:
1) Buying simply because it is CHEAP. The recent bull market had caused most stock prices to fall down by 50~70% from their peak, including blue chips. Many are now taking the opportunity to buy 'popular stocks' (e.g. blue chips belonging to banks or property), simply they looked cheap on the surface. Sounds logical? To a certain extent yes. But do some homework before you throw your hard-earned money in it. Just remember the story of Leh*** brothers.

2) Hope that stock will rebound. What is your waiting duration? Wait until durian drop? 'Experts' advise it's wise to have a stop-loss or profit target for any stock so that you do not get caught in an ugly situation.

3) Missed opportunity. Many people got stuck in the Buy & Hold strategy for stocks. Not willing to cut loss or take a profit because of fear and greed. Holding on to a lousy stock simply means missing out opportunity on a good stock.

So are you ready for the stock market? Or is the stock market ready for you?