Many of you are well aware that fundamental analysis is an important aspect of the trading market. This helps you to find the reason behind the price changes and volatility in the market. Thus, this has given fundamental analysis equal importance. It is something investors must learn about. The importance of fundamental analysis is equal to technical analysis in trading and not having a proper study about the fundamental issues can be the reason you might be losing a big sum of money. It might also be the reason you quit trading.
But the million-dollar question is how do keep a track of such fundamental news events and how do you know which event to look at? Well, these questions are repeatedly asked for obvious reasons. But the best answer to this question is to maintain an economic calendar. We often use calendars to mark important dates so that we don’t miss out on important events. Forgetting about those days might be a bit of a problem for you.
For instance, if you forget your wedding anniversary, you might have to sleep on the couch that night. So, it is better to write it down before you get penalized for tit. Similarly, an economic calendar reminds an investor about important events that may affect market speculation. But how do you use an economic calendar? Here’s how you should maintain it.
Recurring news events
Among the thousands of news events that take place every day, most of them remain uncertain and people barely have any idea about them beforehand. However, some news events take place within a specific time period and repeat after that certain length of time. These events are known as recurring events and having a look at such events is very much helpful for the investors to understand the market behavior. However, those who don’t have basic skills, will be in big trouble dealing with news events. To get the basics, you can visit https://www.home.saxo/en-sg/products/etf and use the free resources at Saxo.
Recurring events are the most predictable news events that help investors with market analysis. Examples include scheduled news releases of various government organizations, central banks, elections, and many more. All sorts of economic news can be part of these news events. The budget, the economic indicators like the GDP play important roles in predicting probable market changes.
Complex economic events
Although there are several other socio-economic conditions like natural disasters, climatic conditions, scandals etc., their impact on different assets is much harder to predict. This makes it harder to speculate any sort of market change as well. Though the changes made by these unpredicted factors have a huge influence over the market, they barely have any importance in an economic calendar.
Since ETF trading is done in international markets, there are several indicators outside the boundary of your country which have the potential to influence your existing trading portfolio. A trading calendar helps you to organize the events based on their importance and intensity and most of the calendars provide a short description of the changes. These calendars are also a great help when it comes to analyzing the influence of such events in the form of percentages. Your calendar might also have the potential to indicate the positive and negative impact of a fundamental event and may also compare the current market performance to the forecasted value.
By understanding the economic calendar, an investor gets to know how much the market is influenced by the release of a certain news event. Furthermore, it helps to distinguish the most important news releases that you need for your trade which is a must-have for investors to avoid spending time looking into unnecessary events.
Lastly, we would like to mention that instead of looking at news events, you should focus more on the charts. This is a market that changes, so, only looking at the market will help you to identify any changes caused by news releases.