Applications of technical analysis and fundamental analysis in stock market: A study on BIST 50

Recently, with the development of technology, people's interest in the stock market has increased. Inflationary movements have occurred regarding events such as diseases, wars, and natural disasters worldwide. Investors have turned to the stock market to protect the value of their savings and investments, and interest in Borsa Istanbul has increased. However, many investors have invested without knowledge of the stock market and have suffered serious losses. The most commonly used stock analysis methods for investing in the stock market are fundamental analysis and technical analysis. Technical analysis tries to predict the future by taking advantage of past price movements. While technical analysis claims that price movements in the past may be repeated in the future, certain shapes emerge due to the decisions and mistakes made by investors in the past. Fundamental analysis is based on the analysis of the financial statements, industry, and economy. Investors who want to invest in stocks use financial statements to reveal the weaknesses and strengths of companies while performing fundamental analysis and decide whether to invest in the company. This study aims to compare technical analysis and fundamental analysis methods to determine which analysis method produces more profitable signals in the BIST 50 index. SMA, RSI, and MACD indicators within the scope of technical analysis and PD/DD, F/K, and FD/FAVÖK ratios within the scope of fundamental analysis are examined in determining buy and sell signals for stocks traded in the BIST 50 index. The findings obtained indicate that profit can be obtained from PD/DD, F/K, and FD/FAVÖK ratios within the scope of fundamental analysis and FD/FAVÖK ratio provides much more returns than other ratios. Also, it is determined that the second highest profit is obtained with the F/K ratio and the lowest profit is obtained with the PD/DD ratio within the scope of fundamental analysis. On the other hand, it is found in the study that profit can be obtained from all three of the MACD, RSI and SMA indicators within the scope of technical analysis and that the MACD indicator obtained proportionally profitable results in more stocks. In brief, it is determined that the profits obtained in both technical analysis and fundamental analysis are close to each other and one analysis method is not superior to the other. In other words, it is recommended usin both analysis methods when making an investment since all of the indicators and ratios are successful.