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CHAPTER TEN GATHERING INVESTMENT INFORMATION Practical Investment Management Robert A. Strong.

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Presentation on theme: "CHAPTER TEN GATHERING INVESTMENT INFORMATION Practical Investment Management Robert A. Strong."— Presentation transcript:

1 CHAPTER TEN GATHERING INVESTMENT INFORMATION Practical Investment Management Robert A. Strong

2 South-Western College Publishing ©1998 2 Outline  Research Philosophy  Know Thyself  Screening  Resources at the Library  Standard & Poor’s Publications  Moody’s Publications  Company Information  Annual Reports  SEC Filings  The Prospectus

3 South-Western College Publishing ©1998 3 Outline  Investment Letters  Advisory Letters  The Popular Press  Computer Services  Screening Services  On-Line Computer Services  Seminars  Brokerage Firms  Bank Trust Departments  Employee Relation Programs  Exchange Seminars

4 South-Western College Publishing ©1998 4 Research Philosophy  Before conducting any research, decide what kind of information will be useful.  Know thyself : Knowing their own attitudes toward various issues can be a big help in allowing investors to make productive use of their research time. E.g. fundamental analysis, technical analysis, the experts’ approach.  Screening is the process of sorting through the list of potential investments.

5 Categories of Investment Information South-Western College Publishing ©1998 5 Standard & Poor’s Moody’s Library Reference Material Annual Reports SEC Submissions Prospectus Company Material Advisory Popular Press Investment Services Screening On-Line Data Computer Services Brokerage Firms Bank Trust Departments Employee Relations Exchange Seminars

6 South-Western College Publishing ©1998 6 Resources at the Library Standard & Poor’s and Moody’s publish easy-to-use reference material that can be found in most public libraries.

7 South-Western College Publishing ©1998 7  Standard & Poor’s Publications - monthly stock guide - quarterly company stock report - monthly bond guide - weekly Outlook (with highlights, summary opinions and statistics) - stock market encyclopedia (S&P 500 stock reports) - earnings forecaster (compilation of estimates) - annual corporation records with daily updates Resources at the Library

8 South-Western College Publishing ©1998 8  Moody’s Publications - detailed manuals - weekly dividend record - bond record - weekly bond survey - quarterly handbook of common stock Resources at the Library

9 South-Western College Publishing ©1998 9 Company Information  Annual reports contain corporate statements about the results of the previous year as well as the prospects for the future. Numerous audited publications are required for publicly traded firms.

10 South-Western College Publishing ©1998 10  SEC filings - 10-K report (annual report) - 10-Q report (quarterly report)  The prospectus outlines the terms of the intended transaction, e.g. issue of new debt securities Company Information

11 South-Western College Publishing ©1998 11 Investment Letters Investors often consider publications that make investment recommendations or forecasts.  Advisory letters offer specific investment recommendations. - Value Line Investment Survey (with timeliness and safety rankings) - Institutional Broker’s Estimate Survey (I/B/E/S) - Zack’s Corporate Earnings Estimator - research information from brokerage firms

12 South-Western College Publishing ©1998 12 Investment Letters  The popular press offer more general information, although recommended investor behavior may still be suggested. - The Wall Street Journal - Barron’s (weekly) - Investors Daily - Forbes (twice monthly) - Smart Money - other magazines - television programs

13 South-Western College Publishing ©1998 13 Computer Services - Value Screen III - Morningstar U.S. Equities on Floppy - Compustat - CRISP tapes - Standard & Poor’s Stockpak - Expanded Academic Index - Disclosure  Screening services use static databases with periodic updates.

14 South-Western College Publishing ©1998 14 Computer Services - CompuServe, Prodigy, and America On-Line - Dow Jones News Retrieval System - S&P Online - the Internet e.g. the U.S. government’s EDGAR database  On-line computer services are dynamic with continuous updates.

15 South-Western College Publishing ©1998 15 Seminars  Local brokerage firms often hold educational seminars for their current and prospective customers.  Bank trust departments also hold seminars.  Some employee relation programs provide investment information to boost employee morale.  The securities exchanges offer education sessions too.

16 South-Western College Publishing ©1998 16 Review  Research Philosophy  Know Thyself  Screening  Resources at the Library  Standard & Poor’s Publications  Moody’s Publications  Company Information  Annual Reports  SEC Filings  The Prospectus

17 South-Western College Publishing ©1998 17 Review  Investment Letters  Advisory Letters  The Popular Press  Computer Services  Screening Services  On-Line Computer Services  Seminars  Brokerage Firms  Bank Trust Departments  Employee Relation Programs  Exchange Seminars


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