ranking and managing stock in the stock market using fundamental and technical analyses

the stock selection problem is one of the major issues in the investment industry, which is mainlysolved by analyzing financial ratios. however, considering the complexity and imprecise patterns ofthe stock market, obvious and easy-to-understand investment rules, based on fundamental analysis,are difficult to obtain. fundamental and technical analyses are two common methods for predictingthe future behavior of the stock.fundamental analysis focuses on the economic forces of supply anddemand which cause stock prices change. on the other hand technical analysis examines historicaldata relating to changes in the price and trading volume by using graphs and indicators as a primarytool to predict future price movements. therefore, in this paper, a model has been proposed forselection of the right portfolio in stock exchange. financial industries ranking and companiesranking have been applied for selection of the right stock in this model. these rankings have beendone through the promethee decision making method. technical analysis has been done fordetermining the right time to buy and sell the superior stocks. a survey has been done fordetermining the effective criteria over industry and company evaluation. the developed model hasbeen applied in tehran stock exchange (tse) as a real case and a real problem has been solved. itis concluded that by using both fundamental and technical analysis, an investor can get higherreturn on stocks instead of using just one individual analysis. in other words, while fundamentalanalysis distinguishes which stocks to buy, technical analysis shows when to buy the superiorstocks.finally, some important and most commonly used indicators have been extracted. theseindicators can be used by investors to consistently and correctly predict the future stocks prices.