FMP
Dec 23, 2023 6:07 AM - Parth Sanghvi
Cryptocurrencies have introduced a new dimension to investment strategies, prompting a closer examination of fundamental analysis within this evolving landscape. While the crypto market often emphasizes technical analysis and market sentiment, fundamental analysis plays a pivotal role in evaluating the underlying value and potential of digital assets.
Unlike traditional assets, fundamental analysis in the crypto sphere revolves around intrinsic factors such as the technology powering a cryptocurrency, its utility, development team, community support, and broader market adoption.
Fundamental analysts assess the core blockchain technology, focusing on scalability, security features, consensus mechanisms, and real-world applications. Understanding a cryptocurrency's practical use beyond speculation is central to fundamental analysis in this domain.
The strength and expertise of a cryptocurrency's development team significantly influence its potential success. Fundamental analysis involves scrutinizing the team's experience, vision, and ongoing contributions. Additionally, community engagement and support provide valuable insights into adoption prospects.
Analysts explore broader market trends, including adoption rates, strategic partnerships, and regulatory developments shaping cryptocurrencies. The level of acceptance and integration within industries or user communities serves as a crucial metric for long-term viability.
Cryptocurrencies present unique challenges for fundamental analysis. Factors such as the absence of standardized valuation models, rapidly evolving technology, regulatory uncertainties, and the sway of market sentiment complicate the assessment of their intrinsic value.
As the crypto market matures, the methodologies for fundamental analysis continue to evolve. New evaluation frameworks, specialized research tools, and standardized metrics are emerging to provide investors with better insights into the fundamentals of different cryptocurrencies.
Fundamental analysis in the crypto market offers a comprehensive approach to evaluating digital assets, focusing on technology, use cases, adoption, and regulatory landscapes. Despite challenges arising from the nascent nature of the market, a nuanced understanding of these fundamentals can guide informed investment decisions in the dynamic realm of cryptocurrencies.
Sep 11, 2023 1:38 PM - Rajnish Katharotiya
Price to Earnings is one of the key metrics use to value companies using multiples. The P/E ratio and other multiples are relative valuation metrics and they cannot be looked at in isolation. One of the problems with the P/E metric is the fact that if we are in the peak of a business cycle, earni...
Sep 11, 2023 1:49 PM - Rajnish Katharotiya
Price-to-Earnings ratio is a relative valuation tool. It is used by investors to find great companies at low prices. In this post, we will build a Python script to calculate Price Earnings Ratio for comparable companies. Photo by Skitterphoto on Pexels Price Earnings Ratio and Comparable Compa...
Oct 17, 2023 3:09 PM - Davit Kirakosyan
Shares of VMware (NYSE:VMW) witnessed a sharp drop of 12% intra-day today due to rising concerns about China's review of the company's significant sale deal to Broadcom. Consequently, Broadcom's shares also saw a dip of around 4%. Even though there aren’t any apparent problems with the proposed solu...