TECHNICAL VS FUNDAMENTAL ANALYSIS: A COMPARATIVE PERFORMANCE REVIEW

Abstract

This study provides a comprehensive comparative analysis of technical and fundamental analysis methods in predicting stock market performance, focusing on the Pakistani equity market. Both approaches are widely used by investors to forecast asset price movements, yet their effectiveness remains debated, especially in emerging markets. Using historical price data, financial statements, and market indicators from the Pakistan Stock Exchange (PSX) between 2010 and 2024, the study applies quantitative models to assess the predictive accuracy, profitability, and risk associated with each method. The findings indicate that while fundamental analysis is more reliable for long-term investment decisions, technical analysis offers superior short-term trading signals. The hybrid approach, combining both methods, shows promise in enhancing portfolio returns and reducing risk.