Synergizing strategies: integrating fundamental, technical and news analysis for stock evaluation in energy & commodity market

Abstract

In the rapidly changing world of stock market investing, finding a solid strategy can be a challenge. This project explores an integrated approach that combines the power of fundamental analysis (FA), technical analysis (TA), and news analysis (NA) to make informed trading decisions. The first step is to use fundamental analysis to select value stocks. We handpicked nine stocks with prospects based on market cap, dividend yield and 10-year average annual returns. These stocks are then divided into three categories based on their market capitalization. A deeper look at each group through the use of fundamental analysis metrics such as revenue, net income, price-to-earnings ratio, debt-to-equity ratio, and return on equity helps identify the top performers in each category for further analysis. Next, technical analysis is used to analyze the selected stocks. Use similarity methods such as regression and Pearson correlation to find patterns in historical data and predict future trends. Through backtesting, the optimal setting is determined for each stock, taking into account factors such as the number of periods of correlation, the forecast time frame, and the range of periods used for forecasting. These insights, combined with clear entry and exit rules, help identify the most promising investment opportunities. Finally, use news analysis to aid decision making. Study five key news categories to understand their short - and long-term impact on stock prices. These categories include cooperation news, investment and expansion in new areas, environmental events, war and conflict news, and the impact of OPEC+ supply decisions. This comprehensive analysis provides a multi-faceted view of the market, enabling more informed decision-making. By synergizing FA, TA, and NA, this project presents a robust framework for dealing with the complexities of the stock market and maximizing investment potential. The insights gained from this comprehensive approach provide valuable guidance for investors seeking to trade profitably in an ever-changing market environment.