Another Way To Identify Winners

- Schalk Louw

I recently came across a comment on social media on the technical analysis of shares. In short, this person believes that technical analysis gets “way too much” attention on social media and reckons a “horrible” technical analysis system combined with an excellent risk/portfolio management system would easily outperform the results of an excellent technical analysis system combined with a poor risk/ portfolio management system.

I definitely do not claim to be a speculative share trader, nor do I claim to be a technical analysis expert. I am also not saying that this person’s opinion is wrong in any way. But I do think it is important to understand the psychology behind the “Why is technical analysis so popular on various media platforms?” question.

I don’t believe it has to be an “either/or” situation when it comes to technical analysis, but rather an “and” situation. Why should a balanced investment management system only consist of one single investment tool? Combining a technical analysis with a fundamental analysis doesn’t mean that you won’t end up with bad apples, but it should definitely improve your chances of achieving success.