Top-Down Investing

Filed Under » , , ,
Dictionary Says

Definition of 'Top-Down Investing'

An investment approach that involves looking at the "big picture" in the economy and financial world and then breaking those components down into finer details. After looking at the big picture conditions around the world, the different industrial sectors are analyzed in order to select those that are forecasted to outperform the market. From this point, the stocks of specific companies are further analyzed and those that are believed to be successful are chosen as investments.
Investopedia Says

Investopedia explains 'Top-Down Investing'

An investor may use different criteria when deciding to employ the top-down approach. For example, an investor may consider such factors as geography, sector and size. What is important with this approach is that a big picture perspective is taken first before looking at the details. Although there is some debate as to whether the top-down approach is better than the bottom-up approach, many investors have found the top-down approach useful in determining the most promising sectors in a given market. 

Related Definitions

Search results for

'Top-Down Investing'

  • Technical Top-Down Investing: Analyzing The Market

    http://www.investopedia.com/articles/trading/09/technical-top-down-investing.asp
    Technical Top-Down Investing: Analyzing The Market. July 08 2009 | Filed Under ยป
    Active Trading, Retirement, Stock Analysis, Stocks, Technical Analysis. ...

  • A Top-Down Approach To Investing

    http://www.investopedia.com/articles/stocks/06/topdownapproach.asp
    A Top-Down Approach To Investing. September ... goals. The second option mentioned
    is referred to as the top-down investing approach to the market. ...

  • What's the difference between "top-down" and "bottom-up" investing ...

    http://www.investopedia.com/ask/answers/193.asp
    ... What's the difference between "top-down" and "bottom-up" investing? Before ...
    Top-down investing involves analyzing the "big picture". Investors ...

  • Where Top Down Meets Bottoms Up

    http://www.investopedia.com/articles/stocks/07/topdownbottomup.asp
    ... Top-down investing looks at macroeconomic variables, as the state of the
    overall economy plays a big role in the investment decision. ...

  • Top-Down Analysis: Finding The Right Stocks And Sectors

    http://www.investopedia.com/articles/trading/09/technical-top-down-sector-stock.asp
    ... returns. Also see Intermarket Analysis and Top-Down Technical Investing for
    more information on analyzing markets and stock selection. ...

  • 4 Top-Down Stocks For Your Portfolio

    http://stocks.investopedia.com/stock-analysis/2010/4-Top-Down-Stocks-For-Your-Portfolio-CF-MON-FCX-DVA0217.aspx
    ... After identifying these trends, stock selection can result in positive investment
    returns. (For more, check out A Top-Down Approach to Investing.). ...

  • Is Your Investing Style Hot, Or Not?

    http://www.investopedia.com/articles/basics/07/diversification-style.asp
    ... (To continue reading about this approach, see Riding The Momentum Investing Wave.)
    Market ... (To read more, see Market Capitalization Defined.) Top-Down and Bottom ...

  • How To Analyze Real Estate Investment Trusts

    http://www.investopedia.com/articles/04/030304.asp
    ... From a top-down perspective, REITs can be affected by anything that impacts the
    supply of and demand for property. ... Daily investing content in your inbox. ...

  • The Key To High Returns Is A Disciplined Strategy

    http://www.investopedia.com/articles/financial-theory/08/investment-strategy.asp
    ... (For related reading, see A Top-Down Approach To Investing.) Each type of ... In investing,
    there are two different approaches: a top-down or a bottom-up approach. ...

  • Why You Shouldn't Manage Your Friends' Money

    http://www.investopedia.com/articles/younginvestors/06/investingforfriends.asp
    ... Find out what you should know in Technical Top-Down Investing.) If you have financial
    knowledge, people who know you might view you as a very valuable ...

Related Articles

Trading Center
Partner Links