What is the definition of the term Fundamental analysis

Fundamental analysis is the technique of analyzing an asset based on its true value. This entails everything from global events to firm management to trading multiples.

The idea behind fundamental analysis is that you gain a true value of an asset and then trade the asset based on whether it is over or undervalued. This follows the assumption that over time, all assets will be priced at their true value, which is not always correct in the markets.

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