You might have heard the expressions ‘top-down’ and ‘bottom-up’ applied to stock picking. Let me explain.
Top-down research is what the economists and strategists do. They try and predict where the equity market will go by working out what earnings are going to do on average over some time period. To do that they don’t look at companies they look at higher level economic inputs like GDP growth, inflation, currency rates, commodity prices, business and consumer...Continue Reading