Friday, March 3, 2017

Where to find free stock research material for your investment needs

I've been somewhat lazy when it comes to updating my blog. Well they say, spend more time doing things where you get the most returns and less time on things that give least returns. Therefore, I spend more time on my investments and improving my health than on blogging. Nevertheless, I still like to keep my blog alive with occasional updates.



Anyway, thought I put out a quick post on some research tools I like for investing in stocks. You don't have to spend ton of money or signup for some expensive monthly subscription or get that hot investment newsletter that is promising to do all the work for you and make you rich.

There are plenty of absolutely free online resources that can get you high quality research material and investment ideas for free.

To be a successful investor, you want to minimize your cost of investment as much as possible to maximize your return and why it is crucial to take advantage of these free investment resources.

Remember, regardless of the path you take for your investment research, at the end it is you who has to do the due diligence and put in an effort to understand the material and come to a conclusion to whether the investment you are about to make is a right investment or not.

No matter what any website or newsletter claims, there are no guarantees for success in investing in stock market. There is no magic tool or investment newsletter that can provide you golden tips in picking the wining stocks.

The only way to give yourself the best chance of being successful in investing is to put in some effort in building an investment strategy and a plan that works for you and then getting to work in doing enough research to ensure you understand what you are buying or selling in the stock market and not just blindly following someone's tips.

The easiest way to research an investment in a stock is to rely on the research of other experienced investors or financial/stock analysts. This is especially true when one does not have the inclination, time, or passion to become a financial expert and dive into balance sheets and earnings reports.

There are investment companies and websites that provide research material on stocks with analyst opinions. However, many of them charge fees or have some type of subscription plan and could become quite expensive for an individual investor, especially if you like to invest in broad range of stocks, like I do.

I like to do my own research and enjoy diving into company's financial statements, I've less need to pay for research material. However, no matter how much time I spend on studying a company's finance, I'm still a no match to a professional stock analyst. Besides most professional stock analyst focus on a single industry or a group of stocks and therefore, have extensive knowledge of the industry over long periods of time.

I can always use other people's, especially expert's research material if available free of charge to compliment my own research. This is the path I would recommend to anyone who is serious about learning to invest in the stock market. Learn to do your own research but always crosscheck or compliment it with expert's research material.

So, how do you find good quality research material for free?

Here are the places I go to when I'm researching a new company or a stock and want to compliment my own research with a research or report from a professional or good quality research outlet:

Brokerage Accounts

Most professional brokerages offer professional research material or analyst reports for free of charge to their customers. It used to be that you had to be a high roller to get access to those reports, but not anymore. Discount brokerages such as ETrade, Fidelity, TDAmeritrade, they all provide stock research reports from well known analyst companies such as Capital IQ, Credit Suisse, SmartConsensus, etc.

My favorite is Capital IQ as well as Credit Suisse (when available). Both of them provide a comprehensive summary of financial health, risks, and investment outlook for a given stock. They also have their own ratings and grades that they assign to each company/stock in question and in addition to target price for a stock.

I find these reports to be very helpful in doing my research on a new stock and would strongly recommend checking out your brokerage's stock research center for these reports. These reports should be offered to you absolutely free at your brokerage's website, if not then it would be time for you to switch your brokerage company.

Investing Related Websites

There are numerous free investment websites that provide their own flavor of stock investment related information. Most of the information on these websites is derived from the financial reports that companies publish at the end of each quarter. However, some of these sites have their own stock analysts and experts who would rank and publish their commentary on stocks.

It's normally easier to look at the financial data summary on these websites than to read each company's financial report individually.

MorningStar.com is one of such websites I use quite often. You can register for free and use their basic free features which are more than enough for an average investor. They have subscription based membership with additional features but I haven't found them to be that useful for my investment style. You can always tryout their premium service for free to see what's it like and whether you want it, but know that once you signup for their premium service (even as a 14-day free tryout) and want to cancel it later, there is no way to cancel it online. You will have to call them to cancel.

They have offered me $69 for the entire year's premium membership, that's $130 off from regular membership fees. So if you decide to go for premium membership, make sure to ask for a discount.

For me, having the basic and free Morningstar coverage is good enough.

FastGraphs.com is the fundamental research tool I use and the only investment tool that I pay for. You can get their basic membership for $9.95/mo (annual rate). This is one tool I don't mind paying for because I get so much out of it. It saves me so much time in screening new and existing stocks that that the small fee pays for itself.

I would highly recommend anyone interested in investing long-term using fundamentals and value approach to give this tool a try. You can get a 14-day free trial.

Seekingalpha.com is an excellent place to go and read latest research articles from a large pool of both professional and regular Joe investors. What I find more valuable than the articles is the commentary in the comment section of each article. They have a huge membership of investors providing their thoughts and opinions on each stock and one can learn a lot by just reading how others invest.

StockTwits is more tailored towards day traders or very active investors. However, I've found it to be quite useful when I need to know why a stock price has just jumped $10 up or down or what the stock momentum or trend is looking like. This is where you can get real-time info on what is going-on for any company/stock that you are interested in.

Dividata.com is a little website that focuses on dividend paying stocks. It's a good place to get a list of dividend paying stocks and to see their dividend history. They also list stocks by their ex-dividend date, so you can see upcoming ex-dividend dates and their ratings.

Investopedia.com is the encyclopedia of investment and financial related terminologies. When starting out learning about investing, you will run into investing and finance jargon that you would have no idea what they mean. This is where Investopedia comes in very handy as you can find detailed explanation to almost anything related to investing and finance on their website. They also have free online training/courses that you can use to learn about investing.

Lastly but not least, always visit the Investor Relations website of the company whose stock you are about to buy or interested in. The investor relations website would contain all the latest presentations and investment related information such as financial reports and investment presentations.

I also like to listen or read the transcripts of latest earnings reports, I mainly pay attention to the questions/answers section of the earnings report as this is where the analysts grill management to get the truth out of them. Remember, the management always paints a rosy picture, it is the analyst who focus on the risks and ask probing questions to get to the bottom of the company's health. So, even if you don't have time to read the full report, make sure you read or listen to at least the questions/answers section.

Alright, that's it for now, I've to get back to my own research on a new stock I am looking to buy soon. Good luck investing!

Disclaimer: I have no affiliation with any of the investment or brokerage websites I mentioned in my blog. In other words, it makes no difference to me if you take my suggestions or not.

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