How to research Shares

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puppy

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Over the years I've bought some shares, they've been a mixed bag including one write-off.

So I'm determined to properly research shares doing the sort of work that you would think investment funds would do.

Can anyone recommend a website/book/place where I can find out how to do this well so at least I'll make rational decisions.

Also if there are any recommended websites that systematically do this for you that would be pretty good too!

Thanks guys
 
Hi puppy

The professional fund managers do not outperform the market.

There is a tiny number of people who have done so consistently. They are so scarce as to be remarkable e.g. Warren Buffett.

Trying to "pick winners" is not a good idea. Buy a diverse portfolio of shares and hold them for the long term.
 
jackswift said:
Is it free?
Click to expand...

No I think it is about $90 pa. But it is a good educational resource and after say two years, you'll have picked up most of the basics. After that it's up to you.

Most people have no problem picking out the good companies, but few people are able to identify a buying opportunity and so over pay. This system at least provides a fairly straight forward way of assessing the current price offers a reasonable chance of a good return or not.
 
Brendan Burgess said:
Hi puppy

The professional fund managers do not outperform the market.

There is a tiny number of people who have done so consistently. They are so scarce as to be remarkable e.g. Warren Buffett.

Trying to "pick winners" is not a good idea. Buy a diverse portfolio of shares and hold them for the long term.
Click to expand...

Hi Brendan,

From my experience there are may reasons why professional funds managers do not outperform the market and very few of them have any thing to do with their investing skills, it's just that the odds are against them right from the start. Pension fund managers here in Switzerland tend to perform well, because they have far fewer restrictions than those placed on retail funds.

By the same token, I expect there are far more individual investors doing very nicely thanks, than you'd expect. Certainly at the two investment clubs I'm involved in, annual returns over the long term (20+ years) of say 10% - 12% are fairly common... of course we pay no taxes on investing gains here so motivation is high.

Having said that it does require a lot of work and if someone is not going to put the effort in, then a broad well balanced portfolio is the way to go. But I would certainly not dismiss the other approach so lightly.

Jim2007
 
We analyse shares for subscribers to gillenmarkets, and in the process we show you how we analyse them, which you can learn from if that is what you are after. And pay no attention to Brendan's odd rant (a joke Brendan), we also have an approach to stock picking in the FTSE 100 Index that does beat the index. The approach needs to be learned, it does not work all the time and patience and discipline are required to succeed with it. There is always a risk that the approach fails to do as well in the future as in the past and each of us must take an educated risk in that regard.

I am publishing a book in October, and the approach is fully written up in the book. I would not expose myself to annihilation by commentators if I was not confident in the approach. Learning about investing can be a past-time as well as a route to saving.

Rory Gillen
 
Hi puppy,

Unlike some of the others, here I am far from an investing expert.

What I did, before buying a few shares, was research some items to be able to evaluate companies e.g. accounting / numeric based items, such as P/E ratio, return on equity, dividend yield, free cash flow etc. These give you a tool to analyse companies (though bear in mind different industries have different charactaristics, so you can be comparing apples and oranges sometimes !!) He was mentioned by Brendan, but I also read some of the partnership letters written by Warren Buffett, and the Berkshire Hathaway annual letters he also wrote. They give some tips as to the thinking of the worlds best known investor.

People are generally advised to invest in what they know, so in your area of work are you familar with companies that you think might do well, or indeed in your personal life ?

Finally, I read as many analyst opinions, annual reports and public info realised by the companies I was thinking of investing in as possible. I'm not saying I understood it all ! but they did give an indication as to the future direction.

I have no affiliation with him, but did like the web video Brendan recently posted of Rory's. It seemed useful in breaking all of this down in an understandable way.
 
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