Practice investment management pim3 ch12

GATHERING INVESTMENT INFORMATION CHAPTER TWELVE Practical Investment Management... Categories of Investment InformationInsert Figure 12-1 here...  Standard & Poor’s Publications- monthl

GATHERING INVESTMENT INFORMATION

CHAPTER TWELVE

Practical Investment Management

 Research Philosophy

 Know Thyself

 Screening

 Resources at the Library

 Standard & Poor’s Publications

 Mergent / Moody’s Publications

 Company Information

 Annual Reports

 SEC Filings

 The Prospectus

 Investment Letters

 Advisory Letters

 The Popular Press

 Computer / Internet Services

 Screening Services

 Investment Seminars

 Brokerage Firms

 Bank Trust Departments

 Employee Relation Programs

 Exchange Seminars

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.

Categories of Investment Information

Insert Figure 12-1 here.

Resources at the Library

Standard & Poor’s and Mergent / Moody’s publish easy-to-use

reference material that can be found in most public libraries.

 Standard & Poor’s Publications

- monthly stock guide

- quarterly company stock report

- bond guide

- weekly Outlook (with highlights, summary opinions and statistics)

- stock market guide (S&P 500 stock reports)

- earnings forecaster (compilation of estimates)

- annual corporation records with daily updates

Resources at the Library

 Mergent / Moody’s Publications

- detailed manuals

- weekly dividend record

- bond record

- quarterly handbook of common stock

Resources at the Library

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.

 SEC filings

- 10-K report (annual report)

- 10-Q report (quarterly report)

- Schedule 14A (proxy statement)

- Form 144 (insider’s “intent to sell” document)

 The prospectus outlines the terms of the

intended transaction, e.g issue of new debt securities

Company Information

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 Brokers Estimate System

(I/B/E/S) and First Call

- Zack’s Investment Research

- research information from brokerage

firms

Value Line Investment Survey

Insert Figure 12-9 here.

Investment Letters

- The Wall Street Journal

- Barron’s (weekly)

- Investors Business Daily

- Forbes (twice monthly)

- Smart Money

- other magazines

 The popular press offer more

general information, although recommended investor behavior may still be suggested

 One group of computer services is static

databases with periodic updates, used

primarily for security screening.

 Another group is dynamic with continuous

updates, used for augmenting the results of other security selection activities.

 Many databases and the home pages of

many listed companies and

investment-related firms and organizations can be

found on the Internet

Computer / Internet Services

Screening Services

- Value Line Investment Survey for Windows

- Compustat

- CRSP tapes

- Academic Search Premier

- Info Trac

- Disclosure

 Screening services use static

databases with periodic updates

Investment 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 educational

sessions too.

 Research Philosophy

 Know Thyself

 Screening

 Resources at the Library

 Standard & Poor’s Publications

 Mergent / Moody’s Publications

 Company Information

 Annual Reports

 SEC Filings

 The Prospectus

 Investment Letters

 Advisory Letters

 The Popular Press

 Computer / Internet Services

 Screening Services

 Investment Seminars

 Brokerage Firms

 Bank Trust Departments

 Employee Relation Programs

 Exchange Seminars

Review