4 Exclusive Interview Questions For An Equity Researcher

Equity Research interview questions

Q 1. What Key factors/Ratio should be looked at while carrying out Fundamental analysis?

ANS. Usually following factors are looked at :

• Price Earnings Ratio (PE),
• Earnings Per Share (EPS),
• Dividend Payout Ratio (DPS),
• Return On Equity (ROE)
• Profit Margin Ratio

Q 2.  In fundamental analysis while analyzing a company ,what factors should be considered ?

ANS.

The various factors of a company which need to be studied includes,

• The Management or the administration of the company.
• The Annual Report of the company.
• Financial Statement Analysis of the company.
• Financial Ratios calculation from the same.

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Q 3.  Can you through some light on Technical Analysis trends?

ANS.  

Technical Analysis Trends:

In our day to day life what do we mean by trend? It simply means the way of moving of particular situation or thing. In Technical Analysis also, a trend means the same that is the direction in which a security or market is moving.

• Bullish Trend – Bullish Trend means moving of stock continuously in upward direction. Bullish Trend means the overall rise in broad market indices.
•  Bearish Trend – Bearish Trend means moving of stock continuously in downward direction. Bearish Trend in simple language means the fall in market indices. Investors considers bearish trend as a pessimistic scenario and go short on that particular stock.
• Range Bound/ Flat Trend – Range Bound/ Flat Trend means stock is neither making movement in upward direction nor in downward direction. Means it is playing in the similar range.

Q 4.  Can you please explain Support and Resistance concept in technical analysis ?

ANS.

Support and resistance are the levels which show the movement of stock.

Support

Support is a price level that a stock tried to cross below, but ultimately stayed above. Support is level which has the lowest closing price value of five consecutive trading sessions.

Resistance

Resistance describes a price level that the stock tried to cross above, but could not.  Resistance is the level which has achieved high price value of five consecutive trading sessions. 

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