Fundamental Analysis
Competency Title:
Fundamental Analysis
Competency Type:
Functional
Competency Description
This competency refers to the ability to measure the intrinsic value of an asset by examining the economic, financial and other qualitative and quantitative factors. The scope includes valuation of securities and derivatives.
Level 1 - Awareness
Level 1
• Identify the sources of data required for fundamental analysis.
• Identify market, industry and company factors that impact the value of an asset.
Level 2 - Knowledge
Level 2
• Identify the appropriate procedure to extract required data from their respective sources.
• Determine factors to be used as input into the financial model.
Level 3 - Skill
Level 3
• Conduct analysis on the quantitative and qualitative data to select relevant data.
• Input relevant data into a financial model to measure the intrinsic value of an asset.
• Interpret results from a financial model for investment purposes.
Level 4 - Mastery
Level 4
• Construct a financial model that determines the value of the asset.
• Validate that the data and assumptions used in the analysis are appropriate for purpose.
• Guide others to interpret results from a financial model for various purposes.
Level 5 - Expert
Level 5
• Evaluate financial model for completeness and validity.
• Monitor and review the effectiveness of the financial model in predicting the value of an asset.
• Establish the criteria to be used to test the validity of conclusions drawn from fundamental analyses.