I collected a lot of stock screens this past year. Most use the free deluxe screener available at the MSN Money website. The screens are sometimes hard to find on the MSN website, so I thought I would share them.
This is a screen that finds high-dividend candidates with good prospects for increasing their payouts:
Current Dividend Yield >= 4.25
Latest Dividend Rate >= 0.25
Last Price >= 15
Fundamental Grade >= C
Market Capitalization >= 1,000,000,000
Mean Recommendation >= Moderate Buy
Return on Equity >= 8
EPS Growth Next 5-Years >= 8
Technical Grade >= C
Here is a link to the MSN article by Harry Domash with a description of how and why the above parameters are used.
Thursday, March 29, 2007
Stock Screen: Solid Dividends
Tuesday, March 27, 2007
Brett Steenbarger's TraderFeed - Blog Review
Traderfeed
An excellent blog that I have read for months now is Brett Steenbarger's Traderfeed. At first glance the blog may appear to concentrate on the trading style of investing with a focus on a short time frame. But a close reading of the blog over several weeks disabuses one of that thought. Why? Because what Mr. Steenbarger discusses on his blog has universal application to all market participants. One must simply filter out the short term discussions to reach the deeper meaning of the material presented.
It simply does not matter where one is on the investing spectrum, the content available at Traderfeed assists all market participants. How can one blog do this? By discussing and focusing on the only element common in all forms of investing: human psychology. Across all time frames and applicable to all styles it is You which must be harnessed for market success. Exploring and understanding your competencies and limitations reigns paramount above all else. That is what the Traderfeed is all about.
That is why, in my opinion, Traderfeed is one of the most important blogs a new investor or trader reads.
Traderfeed
Tuesday, March 20, 2007
Resource Review: Trader Mike On Position Sizing
Trader Mike On Position Sizing
As many of you know, the Trader Mike blog is one of my top five blogs. It is also a great resource for new traders.
One of the best articles I have found on Trader Mike's blog is his great post on position sizing. Not only does Trader Mike do a great job of explaining why position sizing is important to a trader, he also provides several great links to other websites that will help anyone struggling with the concept. In addition, as does Chris Perruna, Trader Mike also provides a link to his position sizing spreadsheet.
As many of you know, the Trader Mike blog is one of my top five blogs. It is also a great resource for new traders.
One of the best articles I have found on Trader Mike's blog is his great post on position sizing. Not only does Trader Mike do a great job of explaining why position sizing is important to a trader, he also provides several great links to other websites that will help anyone struggling with the concept. In addition, as does Chris Perruna, Trader Mike also provides a link to his position sizing spreadsheet.
Those unfamiliar with position sizing will be well served to take a look at what Trader Mike has to say on position sizing.
Trader Mike On Position Sizing
Trader Mike On Position Sizing
Monday, March 19, 2007
Investing Resource Review: Dividend Discount Model
Dividend Discount Model
A website that I like to use is Dividend Discount Model.
As stated on the main page Dividend Discount Model "gives you access to the popular Dividend Discount Model (DDM) used to value publicly traded stocks. DDM calculates the present value of the future dividends that a company is expected to pay its shareholders. DDM can also calculate the expected return implied by the current dividend yield and projected dividend growth."
Dividend Discount Model is very simple to use and has a lot of great information for the new investor who would like to incorporate dividends into a value analysis.
Dividend Discount Model
Sunday, March 18, 2007
John Bogle's Little Book of Common Sense Investing - Book Review
The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns
What Is It About?
This book is about investing in businesses rather than stocks. The book demonstrates that for most investors purchasing an index fund guarantees the best stock market success. By using simple math and common sense John Bogle demonstrates that, for most investors, an index fund will result in higher returns than the same investment in an actively managed fund.
What Did I Get Out Of It As A New Investor?
This is the first investing book a new investor should read.
Whether you decide to invest in mutual funds or manage your own portfolio of individual stocks, understanding the power of index investing becomes the most important thing for any new investor. Why? Understanding that most investors will have better success by purchasing an index fund can serve to ground one's expectations of just how much value they can add by managing their own portfolio.
Before I begin to describe what Mr. Bogle does say in his book I would like to address what he does not say. Mr. Bogle does not state anywhere in his book that a motivated individual willing to dedicate a sufficient amount of time and effort cannot achieve above market returns. Therefore, this book does not reject the premise that an enterprising investor or trader may have the ability to beat the market.
Mr. Bogle does say that if you have a choice between investing in a managed mutual fund or an index fund, choose an index fund because not only will the managed fund risk under performing the market, the mutual fund investor must overcome the fees charged by the mutual fund (i.e., management fees, transaction fees, and taxes) which will eat away returns such that the mutual fund will not beat the index. In other words, why take the risk of figuring out which fund manager to choose, which mutual fund to choose, which style to choose, and what fees to pay, when you are better off in a total market index.
That's it. That is all Mr. Bogle says. He does not, anywhere in the book, say that a focused (or enterprising) investor who is willing to invest the time should index. He simply agrees with what Warren Buffett says "the know nothing investor can actually out perform most investment professionals" by investing in an index fund.
In making this point Mr. Bogle looked at the 36 year period from 1970-2006. At the start of 1970 there were 355 equity funds. By 2006, only three out of the original 355 funds beat the index consistently over the 36 year period. Clearly, the investor with a multi-decade horizon should accept the return of the index fund.
With respect to the investor who desires to manage his own account, this is the best of the three books in the “Little Book” series. Why? The book sets the baseline for the new investor. You can buy the U.S./Intl total market index and know that you will do no better or worse than what businesses will do over time.
Indexing requires little or no effort and about $10-20 per year for every $10,000 invested. Compare that to a mutual fund that charges $100-300+ year after year for every $10,000 invested with no guarantee that it will beat the index fund. By making this point the book shows a new investor a way to participate in the market with little effort and do as well as the best money managers over the long term. For those who must choose between mutual funds and index funds, this book makes obvious the path to take.
For the investor who desires to manage his own account the book tells a scary tale. Again, Mr. Bogle never says that one cannot beat the market or in anyway disparages those who have found success. He does not have to. Over and over Mr. Bogle, using simple math, demonstrates the relentless nature of a total stock market index. The index never rests and will not make mistakes. You will do all those things.
Consequently, in order to beat the index one must obtain above average results. Yet the fact is we can't all achieve above average results. A few will, most will not, and a lot will just end up matching it – but, with a lot of wasted effort and unneeded stress when they simply could have bought the index and spent the time saved with their family.
This book makes you take a close look and ask yourself whether you have what it takes to beat the index when so many others do not. Depending on your investment style will you spend hours and hours reading annual reports, thinking about businesses, thinking about the market, studying charts, or developing trading systems? Will you do this year after year with the knowledge that so few do it successfully? Will you have the necessary emotional control to maintain a consistent approach no matter how negative the short term results? If the answer is anything less than an unqualified affirmative, the book demonstrates that perhaps indexing is for you.
Overall, the book does not say individual investing has no utility. The book just uses simple math to show that the odds of you (or anyone else) practicing it in a manner which will allow you to beat the index weigh against you. That is why Mr. Bogle’s book is so good; it forces one to confront reality and assess whether to make the commitment necessary to succeed against an index fund.
The Good News
An outstanding book because it forces all investors to honestly question whether they or anyone else has what it takes to beat the index.
The Bad News
If you use “Maverick” as a nickname and think index funds are for widows and orphans, you probably won't get much out of this book.
The Bottom Line
A must read because the book provides sobering advice to a new investor on the merits of index investing as compared to active portfolio management..
Other Related Reading:
What Is It About?
This book is about investing in businesses rather than stocks. The book demonstrates that for most investors purchasing an index fund guarantees the best stock market success. By using simple math and common sense John Bogle demonstrates that, for most investors, an index fund will result in higher returns than the same investment in an actively managed fund.
What Did I Get Out Of It As A New Investor?
This is the first investing book a new investor should read.
Whether you decide to invest in mutual funds or manage your own portfolio of individual stocks, understanding the power of index investing becomes the most important thing for any new investor. Why? Understanding that most investors will have better success by purchasing an index fund can serve to ground one's expectations of just how much value they can add by managing their own portfolio.
Before I begin to describe what Mr. Bogle does say in his book I would like to address what he does not say. Mr. Bogle does not state anywhere in his book that a motivated individual willing to dedicate a sufficient amount of time and effort cannot achieve above market returns. Therefore, this book does not reject the premise that an enterprising investor or trader may have the ability to beat the market.
Mr. Bogle does say that if you have a choice between investing in a managed mutual fund or an index fund, choose an index fund because not only will the managed fund risk under performing the market, the mutual fund investor must overcome the fees charged by the mutual fund (i.e., management fees, transaction fees, and taxes) which will eat away returns such that the mutual fund will not beat the index. In other words, why take the risk of figuring out which fund manager to choose, which mutual fund to choose, which style to choose, and what fees to pay, when you are better off in a total market index.
That's it. That is all Mr. Bogle says. He does not, anywhere in the book, say that a focused (or enterprising) investor who is willing to invest the time should index. He simply agrees with what Warren Buffett says "the know nothing investor can actually out perform most investment professionals" by investing in an index fund.
In making this point Mr. Bogle looked at the 36 year period from 1970-2006. At the start of 1970 there were 355 equity funds. By 2006, only three out of the original 355 funds beat the index consistently over the 36 year period. Clearly, the investor with a multi-decade horizon should accept the return of the index fund.
With respect to the investor who desires to manage his own account, this is the best of the three books in the “Little Book” series. Why? The book sets the baseline for the new investor. You can buy the U.S./Intl total market index and know that you will do no better or worse than what businesses will do over time.
Indexing requires little or no effort and about $10-20 per year for every $10,000 invested. Compare that to a mutual fund that charges $100-300+ year after year for every $10,000 invested with no guarantee that it will beat the index fund. By making this point the book shows a new investor a way to participate in the market with little effort and do as well as the best money managers over the long term. For those who must choose between mutual funds and index funds, this book makes obvious the path to take.
For the investor who desires to manage his own account the book tells a scary tale. Again, Mr. Bogle never says that one cannot beat the market or in anyway disparages those who have found success. He does not have to. Over and over Mr. Bogle, using simple math, demonstrates the relentless nature of a total stock market index. The index never rests and will not make mistakes. You will do all those things.
Consequently, in order to beat the index one must obtain above average results. Yet the fact is we can't all achieve above average results. A few will, most will not, and a lot will just end up matching it – but, with a lot of wasted effort and unneeded stress when they simply could have bought the index and spent the time saved with their family.
This book makes you take a close look and ask yourself whether you have what it takes to beat the index when so many others do not. Depending on your investment style will you spend hours and hours reading annual reports, thinking about businesses, thinking about the market, studying charts, or developing trading systems? Will you do this year after year with the knowledge that so few do it successfully? Will you have the necessary emotional control to maintain a consistent approach no matter how negative the short term results? If the answer is anything less than an unqualified affirmative, the book demonstrates that perhaps indexing is for you.
Overall, the book does not say individual investing has no utility. The book just uses simple math to show that the odds of you (or anyone else) practicing it in a manner which will allow you to beat the index weigh against you. That is why Mr. Bogle’s book is so good; it forces one to confront reality and assess whether to make the commitment necessary to succeed against an index fund.
The Good News
An outstanding book because it forces all investors to honestly question whether they or anyone else has what it takes to beat the index.
The Bad News
If you use “Maverick” as a nickname and think index funds are for widows and orphans, you probably won't get much out of this book.
The Bottom Line
A must read because the book provides sobering advice to a new investor on the merits of index investing as compared to active portfolio management..
Other Related Reading:
Saturday, March 17, 2007
John Chow Dot Com - Blog Review
As many of you know, one of the things I do here on this blog is review other blogs. I do it free of charge. But I have recently discovered that what I do may have some value other than receiving an appreciative thank you from the author of the blog I reviewed. An interesting blog that I have come across that demonstrates the power of saying nice things about another website is John Chow Dot Com.
John Chow is a self described dot com mogul and founder of The Tech Zone. The John Chow Dot Com blog covers many topics including John Chow on Technology, John Chow on the Net, John Chow on How to Use Wordpress, and of course the category that caught my eye, John Chow on Investing.
In the category of Investing, John Chow discusses such topics as: flipping real estate for profit, tips to maximize your RRSP, the impact of tax on investment income, the mutual fund scam, the greater fool theory, and the gun and butter theory. All of these posts provide solid information on the topics covered.
Currently the subject that the John Chow Dot Com blog covers most often now is how to make money online. Covering such topics as commenting your way to the top, hiding affiliate links for better seo, the importance of deep linking, and using other advertising networks besides google adsense the John Chow Dot Com blog shows you how to monetize your blog if that's what you want to do.
In fact what really gets me is that John Chow gets $250 to review other websites and blogs. As an example for the month of March the John Chow Dot Com blog has already done well over a dozen reviewme reviews at $250 a pop. And here I was happy to get a free book now and then when I did a review. Silly me. LOL.
Of course reviews are not all that the John Chow Dot Com does. John Chow also accepts other kinds of placements to advertise his blog. How much does this all add up to?
On his blog John Chow details how much money he makes from the John Chow Dot Com blog. While John Chow states that he never started John Chow dot Com to make money, he has done just that. How much money? In the last several months the earnings from his blog have been quite good.
For October 2006, John Chow made $1,361.64 with his blog; for November 2006, John Chow made $2,139.93 with his blog; for December 2006, John Chow made $2,790.05 with his blog; for January 2007, John Chow made $3,440.66 with his blog; and in February 2007, John Chow made $7,011.05 with his blog. Not bad.
The thing about John Chow is that not only does he discuss how well he is doing, but he also takes the time to help out new bloggers by offering them a link on his blog if they do a blog review of his John Chow Dot Com blog. Some other websites that get a lot of traffic are pretty stingy with their links, but not John Chow.
John Chow has also done some nice things with raising money to help feed the hungry this Easter by raising over $1000 for the Union Gospel Mission. Since John Chow seems to be of a giving nature I think I will do something for his readers.
Last month John Chow had a contest where he asked his readers to "guess my February blog income" and gave away a free watch for the closest guess. Therefore, in March I will give away a copy of Kenneth Fisher's "The Only Three Questions That Count: Investing by Knowing What Others Don't
" to the person who comes closest to guessing what John Chow's blog income is in the month of March 2007 from his John Chow Dot Com. To see what the book is about you can read my review of Ken Fishers' book.
Here are the rules:
1. All entries should be left as a comment to this post no later than 11:00 p.m. PST on March 25, 2007.
2. Closest to the actual earnings for March 2007 (over/under) wins the book.
Good Luck.
John Chow is a self described dot com mogul and founder of The Tech Zone. The John Chow Dot Com blog covers many topics including John Chow on Technology, John Chow on the Net, John Chow on How to Use Wordpress, and of course the category that caught my eye, John Chow on Investing.
In the category of Investing, John Chow discusses such topics as: flipping real estate for profit, tips to maximize your RRSP, the impact of tax on investment income, the mutual fund scam, the greater fool theory, and the gun and butter theory. All of these posts provide solid information on the topics covered.
Currently the subject that the John Chow Dot Com blog covers most often now is how to make money online. Covering such topics as commenting your way to the top, hiding affiliate links for better seo, the importance of deep linking, and using other advertising networks besides google adsense the John Chow Dot Com blog shows you how to monetize your blog if that's what you want to do.
In fact what really gets me is that John Chow gets $250 to review other websites and blogs. As an example for the month of March the John Chow Dot Com blog has already done well over a dozen reviewme reviews at $250 a pop. And here I was happy to get a free book now and then when I did a review. Silly me. LOL.
Of course reviews are not all that the John Chow Dot Com does. John Chow also accepts other kinds of placements to advertise his blog. How much does this all add up to?
On his blog John Chow details how much money he makes from the John Chow Dot Com blog. While John Chow states that he never started John Chow dot Com to make money, he has done just that. How much money? In the last several months the earnings from his blog have been quite good.
For October 2006, John Chow made $1,361.64 with his blog; for November 2006, John Chow made $2,139.93 with his blog; for December 2006, John Chow made $2,790.05 with his blog; for January 2007, John Chow made $3,440.66 with his blog; and in February 2007, John Chow made $7,011.05 with his blog. Not bad.
The thing about John Chow is that not only does he discuss how well he is doing, but he also takes the time to help out new bloggers by offering them a link on his blog if they do a blog review of his John Chow Dot Com blog. Some other websites that get a lot of traffic are pretty stingy with their links, but not John Chow.
John Chow has also done some nice things with raising money to help feed the hungry this Easter by raising over $1000 for the Union Gospel Mission. Since John Chow seems to be of a giving nature I think I will do something for his readers.
Last month John Chow had a contest where he asked his readers to "guess my February blog income" and gave away a free watch for the closest guess. Therefore, in March I will give away a copy of Kenneth Fisher's "The Only Three Questions That Count: Investing by Knowing What Others Don't
" to the person who comes closest to guessing what John Chow's blog income is in the month of March 2007 from his John Chow Dot Com. To see what the book is about you can read my review of Ken Fishers' book.Here are the rules:
1. All entries should be left as a comment to this post no later than 11:00 p.m. PST on March 25, 2007.
2. Closest to the actual earnings for March 2007 (over/under) wins the book.
Good Luck.
Wednesday, March 14, 2007
Blog Review: The Value Blogs
The Value Blogs
A great site I found the other day is The Value Blogs. It is a collection of posts from several different blogs focusing on fundamental investing. The blog describes itself as "a one-stop resource for value investors." It does a good job of meeting that description.
The blog features as contributing writers several of the more prominent investment bloggers. The complete list of The Value Blogs contributing sites is available here. The list includes Fat Pitch Financials, Gannon On Investing, The Sin Letter, The Micro Cap Speculator, Value Discipline, and many other great blogs.
Overall, for those interested in reading blogs which focus on the value style of investing it is a quick way to see the latest posts.
The Value Blogs
Tuesday, March 13, 2007
Trader Vic - Methods of a Wall Street Master - Book Review
Trader Vic--Methods of a Wall Street Master
What Is It About?
This book is about a successful trader and his methods to achieve stock market success. The book covers trading system development, basic economic theory, and emotional discipline while trading. The book is well written and presented in a fashion that even the new investor or trader can follow.
What Did I Get Out Of It As A New Investor?
This is a great book. Even though it is nearly fifteen years hold, the book presents guidelines that are never out of fashion. Taking the reader through philosophical development of a trading system, trend following, market cycles, and psychological commitment to the trading system, the author helps the new investor or trader grasp what it takes to succeed in the market. A solid work from beginning to end.
The Good News
An easy to read book about trading that one can learn a lot from.
The Bad News
May not be the best book for those who reject any method other than fundamental analysis.
The Bottom Line
A great book worth the time to read because it sets forth timeless guidelines all traders should understand.
Other Related Reading:
My Review
My Review
Monday, March 12, 2007
Joel Greenblatt's Little Book That Beats The Stock Market - Book Review
The Little Book That Beats the Market
What Is It About?
This book is an introduction to achieving above average returns in the stock market. In a simple and easy to understand manner the book explains that the way to beat the stock market is to buy the stock of good companies selling for a cheap price relative to their intrinsic value. The book also provides a link to a website that allows one to see what stocks the author believes are possible buys based on his system as articulated in the book.
What Did I Get Out Of It As A New Investor?
This is an excellent book for the new investor. The book provides an easy to understand explanation as to how and why the system presented works. The author also makes available a website that allows the individual to see what stocks currently qualify as possible purchases. In short, this book not only tells you about the system it also helps you implement the system free of charge.
The Good News
One of the best introductory books on the value/growth style of investing.
The Bad News
Not much here for the more experienced investor.
The Bottom Line
One of the best books for new investor or for those having trouble grasping value investing concepts.
Other Related Reading:
My Review
Blog Rolling
Do you have a blog?
Does your blog appear on my blog roll to the right?
Do you use blogrolling.com to manage your blog roll?
If you answered yes to the first two questions but no to the second then you are missing out on a good way to generate some traffic.
If you look at the blogroll on the right you will see that I have activated the preference that allows me to tell when a new post is up on your blog. This lets me and anyone else who visits the blog to see what content is fresh. I set it to consider any post in the last 6 hours as new.
So use blogrolling.com and it may just get you a visit or two.
Sunday, March 11, 2007
John Neff on Investing - Book Review
John Neff on Investing
What Is It About?
This book is the story of John Neff, former manager of the Windsor Mutual Fund. The book is divided into three parts. The first part describes Mr. Neff’s early life leading up to his taking the helm of the Windsor Fund. The second part of the book describes Mr. Neff’s investing style and the techniques he used to obtain above average market success. The final part is a decade by decade review of Mr. Neff’s trading journal and the various investments made using the principles from part two.
What Did I Get Out Of It As A New Investor?
This is an excellent book about an individual who was able to consistently achieve stock market success. Blending a style of investing that I describe as value with contrary ideas, Mr. Neff lays out his method of success describing it simply as “low price-earnings investing.” Applying several principles (e.g., buying low p/e stocks that are fundamentally sound, with growth potential) Mr. Neff attributes his success to maintaining consistency of investing style.
This point provides the investor with the best lesson. Mr. Neff’s success is owed to the simple fact that he found a method of investing that not only worked, but most importantly, worked for him. He then adhered to that style for over 40 years. Consequently, no matter what your time frame or investing/trading style, if you can find something that works and works for you, the hardest part will be simply to maintain the discipline to consistently stick with it your chosen style.
The Good News
Fast paced easy read.
The Bad News
Discusses only in general terms the reasons why certain stock selections were made.
The Bottom Line
For those who want to learn more about fundamental investing this book is a great read.
Other Related Reading:
My Review 
My Review
Wednesday, March 07, 2007
Rocking Wall Street: Four Powerful Strategies - Book Review
Rocking Wall Street: Four Powerful Strategies That Will Shake Up the Way You Invest, Build Your Wealth And Give You Your Life Back
What Is It About?
This book is about developing a specific mindset towards the market allowing one to obtain a balanced state in order to invest to live as opposed to living to invest. The book covers such topics as emotional controls, separating fact from hype, constructing a hedged portfolio, and planning for the future. The books main focus helps investors recognize what will make them happy and how to maintain that happiness. For the high net worth investor the book also offers detailed advice on how to invest in hedge funds as well as providing an appendix that explains and offers sample questions in order to perform due diligence on hedge funds.
What Did I Get Out Of It As A New Investor?
If you had to invest in only one of two ways: you could risk 95% of your net worth on a venture that might double your investment but only had a 10% chance of success or you could place the money in a safe investment returning a guaranteed 5-6% per year, which would you choose?
While it may seem obvious to many what the right answer is, this book explains how investors, both high and low net worth, often allow their greed and desire for more lead them to bad decisions. Drawing on his experience the author demonstrates that in order to truly achieve outsize returns one must give up the windfall in order to avoid the big fall.
Convincing investors that large fortunes are made through incremental steps over time is a hard thing to do, but this book does a good job of initiating the conversation. A conversation designed to help investors achieve and maintain investing success and control the greed emotion that drives many to attempt to create wealth with one grand move.
The Good News
A good work for those looking to understand that stock market success requires patience, discipline, and above all else emotional control.
The Bad News
While the book does discuss asset allocation strategies, nothing in the way of a concrete investing/trading system is offered.
The Bottom Line
A quick and short 176 page book that offers solid strategy on how to mentally approach the market.
Other Related Reading:
My Review
My Review
Monday, March 05, 2007
Online Discount Stock Broker Review
This weekend Barrons has the annual issue out which reviews the online/discount brokers. While it does a good job overall, I think it misses some specific aspects of brokers that new investors are looking for.
This time last year I was looking for a stockbroker and found it a bit confusing as to which one might be best for me. As a new investor what I craved most of all was access to information and research. And I wanted it in a cost effective manner.
So I did a bit of reading and came up with a list of stockbrokers that might appeal to new investors who are looking for professional research for the least amount of money. In fact, what I found is that it is pretty easy and essentially free to get research services that others might pay several hundreds of dollars to receive.
For those who already are happy with their broker it is easy to access these brokers in a manner that does not require moving your current account. Moreover, the list may appeal to the more active trader who has an account at one of the brokers that start at only a $1-2 per trade (MB Trading and Interactive Brokers). The active trader gains access to research not available with their primary stockbroker who was selected for different reasons.
I limited my research to online stock brokers who do not charge any fees for account activity or any fee to maintain an IRA. Why? Because most new investors either do not trade actively and/or opening an IRA will be the way they begin to invest. Also, because these accounts may be secondary accounts holding down costs is important. Moreover, I wanted this list to be relevant for the more experienced investor who is looking to access different research sources without having to commit large amounts of capital to a secondary account and worry about maintaining a certain level of activity. Furthermore, I only included brokers that actually offered some type of third party research for no additional charge to account holders.
This only left eight online or discount stock brokers out of over 50 that I checked. I ranked them based on 1. amount of research offered; 2. trade cost; and 3. minimum amount to open. Here is what I found.
Coming in at No. 8 is Accutrade. Stock Trades are $29.95. Minimum to open is $2,000. Research includes Institutional Shareholder Services, S&P Stock Reports, and Bob Gabele's Insider Trading Watch.
Pros: No account fees
Cons: $29.95 for a trade; $2,000 to open; $29.95 for a trade; limited research; $29.95 for a trade
Bottom Line: Did I mention $29.95 for a trade? That alone stops me. Throw in the $2,000 minimum to open, limited research, and the lackluster website and I am no way Jose on this one.
Tied at No. 6-7 is Scottrade. Scottrade offers $7.00 stock trades. $500.00 minimum to open with no account fees. Research includes: S&P Reports and Thomson Financial.
Pros: $7.00 trades; many local office locations; no account fees
Cons: $500.00 to open and limited research
Bottom Line: If you want/need to be able to walk in and talk to your broker than Scotttrade is for you, as it has many physical branches nationwide. $7.00 trades are a plus but limited research holds me back.
Tied at No. 6-7 is Firstrade. Firsttrade offers $6.95 stock trades. No minimum to open and no account activity or IRA fee. S&P Reports are offered.
Pros: $6.95 stock trades, no minimum to open; no account fee
Cons: Only offers S&P reports
Bottom Line: Good pricing on stock trades at $6.95 and no minimum to open get it tied with Scottrade, but very limited research makes it a no go in my book.
No. 4-5 is E*Trade. Etrade offers $12.99 stock trades. The available research includes Reuters Research, S&P Reports, Rochdale Research, Sabrient Systems, Wall Street On Demand, Thomson Financial, and Bank of New York’s Jaywalk Research Reports. For those with large accounts ($100,000+) Credit Suisse Research is also available. You can find the whole list here.
Pros: Wide offering of research providers; no fee IRA accounts
Cons: $12.95 stock trades; $1,000 minimum to open; non-IRA accounts must make at least one trade per quarter or are assessed $40 account charge
Bottom Line: At first glance looks inviting based on the amount of research available, but the $40 account charge on non-IRA accounts and $1,000 minimum to open puts me off. $12.95 for trades is also a negative. Objectively it could be higher, but hey it is my list and I just get the feeling that it is more of a bank with a lot of little fees here and there.
Pros: $6.95 stock trades, no minimum to open; no account fee
Cons: Only offers S&P reports
Bottom Line: Good pricing on stock trades at $6.95 and no minimum to open get it tied with Scottrade, but very limited research makes it a no go in my book.
No. 4-5 is E*Trade. Etrade offers $12.99 stock trades. The available research includes Reuters Research, S&P Reports, Rochdale Research, Sabrient Systems, Wall Street On Demand, Thomson Financial, and Bank of New York’s Jaywalk Research Reports. For those with large accounts ($100,000+) Credit Suisse Research is also available. You can find the whole list here.
Pros: Wide offering of research providers; no fee IRA accounts
Cons: $12.95 stock trades; $1,000 minimum to open; non-IRA accounts must make at least one trade per quarter or are assessed $40 account charge
Bottom Line: At first glance looks inviting based on the amount of research available, but the $40 account charge on non-IRA accounts and $1,000 minimum to open puts me off. $12.95 for trades is also a negative. Objectively it could be higher, but hey it is my list and I just get the feeling that it is more of a bank with a lot of little fees here and there.
Tied No. 4-5. is Optionsxpress. Optionsxpress offers stock trades for $14.95 with no minimums to open and no account fees. Optionxpress provides free access to Morningstar stock reports.
Pros: Morningstar research; good tools for option traders; no minimum to open, no fees on any account
Cons: Stock trades are $14.95; only offers Morningstar stock research
Bottom Line: No hidden fees at all is a big plus as is no minimum to open, but $14.95 for stock trades is a negative (if the trade cost was under $10 I would have put them at No. 3). While it is limited in research to Morningstar Stock Reports it is the only broker to offer access to Morningstar so that gives it a slight edge to E*Trade in my book. Note: For those interested in Health Savings Accounts (HSA) Optionsxpress is one of the very few ways you can actually set up an HSA account and trade normally.
No. 3 is Muriel Seibert. Trades are $14.95. No minimum to open and no account fee except on IRA’s less than $10,000 ($30 per year). Seibert offers the following research: Standard & Poor's Reports, Zacks Research, Reuter’s Multex, ProphetFinance, Validea, MarketEdge®, VectorVest®, Growth Stock Analytics, Lehman Brothers, and Thomson Baseline.
Pros: No minimum to open, wide variety of research
Cons: $14.95 to trade, $30 a year on IRAs less than $10,000
Bottom Line: Good selection of research. $14.95 to trade is a negative as is the $30 per year charge on a IRA. But it offers a wide variety of research with a couple of unique products not offered elsewhere. If there is some specific research provided which is something you are looking for than this may be the choice for you. It gets the nod over E*Trade based on no minimum to open and over Optionsxpress based on the amount of research. If Seibert cut its trade cost and got rid of the $30 IRA account fee it could challenge for the top two spots.
No. 2 is Fidelity. Fidelity has stock trades for $19.95. There is a $2,500 minimum to open but no account fees. Research is extensive: Argus Research, Ativo Research, LLC, Channel Trend, Columbine Capital Services, Decision Economics, Ford Equity Research, Lehman Brothers, Market Edge, Ned Davis Research , Prudential Equity Group, Standard & Poor's Reports and Outlook, Thomas White International, Thomson Financial, and Zacks Research .
Pros: Lots of Research, No account fees, local branches
Cons: Trades are $19.95, $2,500 minimum to open
Bottom Line: While the trade price is high at $19.95, the amount of available research makes Fidelity one to consider. Also, many investors might have a 401(k) here and that may make it easier to keep everything in one spot. The trade cost and large minimum to open kept it out of first place.
The No 1 pick is TDAmeritrade. Stock trades are $9.99. Minimum to open is $1,000 for IRA accounts and $2,000 non-IRA. Research includes : S&P Reports and Outlook, Vickers Stock Research, Thomson’s First Call, The Street.com Ratings, Ford Equity Research, and Thomson’s Market Edge.
Pros: $9.99 stock trades, lots of research, no account fees
Cons: $1,000/$2,000 minimum to open
Bottom Line: TDAmeritrade offers good selection of research and a low trade price. While the minimum to open is a drawback, overall I would say TDAmeritrade deserves consideration and gets a slight nod over Fidelity based on the trade cost.
In the end I like Fidelity for the selection of research and if I based it solely on that I would say that it would be No. 1. But TDAmeritrade is no slouch in research and offers a trade cost half as much as Fidelity’s so it gets the nod as No. 1, but just barely.
Overall, any one of these brokers is a good deal, and my 1-5 are all solid choices. While I have ranked them as a means of separating them relative to each other, they all provide more value than they ask for. That is because anyone of the brokers is offering several hundred dollars worth of research just to open an account, in some cases with no minimum, and at no annual cost. Pretty good bargain for any investor.
Sunday, March 04, 2007
Investing Resource Review: Online - Discount Stock Brokers
This weekend Barrons has the annual issue out which reviews the online/discount brokers. While it does a good job overall, I think it misses some specific aspects of brokers that new investors are looking for.
This time last year I was looking for a stockbroker and found it a bit confusing as to which one might be best for me. As a new investor what I craved most of all was access to information and research. And I wanted it in a cost effective manner.
So I did a bit of reading and came up with a list of stockbrokers that might appeal to new investors who are looking for professional research for the least amount of money. In fact, what I found is that it is pretty easy and essentially free to get research services that others might pay several hundreds of dollars to receive.
For those who already are happy with their broker it is easy to access these brokers in a manner that does not require moving your current account. Moreover, the list may appeal to the more active trader who has an account at one of the brokers that start at only a $1-2 per trade (MB Trading and Interactive Brokers). The active trader gains access to research not available with their primary stockbroker who was selected for different reasons.
I limited my research to online stock brokers who do not charge any fees for account activity or any fee to maintain an IRA. Why? Because most new investors either do not trade actively and/or opening an IRA will be the way they begin to invest. Also, because these accounts may be secondary accounts holding down costs is important. Moreover, I wanted this list to be relevant for the more experienced investor who is looking to access different research sources without having to commit large amounts of capital to a secondary account and worry about maintaining a certain level of activity. Furthermore, I only included brokers that actually offered some type of third party research for no additional charge to account holders.
This only left eight online or discount stock brokers out of over 50 that I checked. I ranked them based on 1. amount of research offered; 2. trade cost; and 3. minimum amount to open. Here is what I found.
Coming in at No. 8 is Accutrade. Stock Trades are $29.95. Minimum to open is $2,000. Research includes Institutional Shareholder Services, S&P Stock Reports, and Bob Gabele's Insider Trading Watch.
Pros: No account fees
Cons: $29.95 for a trade; $2,000 to open; $29.95 for a trade; limited research; $29.95 for a trade
Bottom Line: Did I mention $29.95 for a trade? That alone stops me. Throw in the $2,000 minimum to open, limited research, and the lackluster website and I am no way Jose on this one.
Tied at No. 6-7 is Scottrade. Scottrade offers $7.00 stock trades. $500.00 minimum to open with no account fees. Research includes: S&P Reports and Thomson Financial.
Pros: $7.00 trades; many local office locations; no account fees
Cons: $500.00 to open and limited research
Bottom Line: If you want/need to be able to walk in and talk to your broker than Scotttrade is for you, as it has many physical branches nationwide. $7.00 trades are a plus but limited research holds me back.
Tied at No. 6-7 is Firstrade. Firsttrade offers $6.95 stock trades. No minimum to open and no account activity or IRA fee. S&P Reports are offered.
Pros: $6.95 stock trades, no minimum to open; no account fee
Cons: Only offers S&P reports
Bottom Line: Good pricing on stock trades at $6.95 and no minimum to open get it tied with Scottrade, but very limited research makes it a no go in my book.
No. 4-5 is E*Trade. Etrade offers $12.99 stock trades. The available research includes Reuters Research, S&P Reports, Rochdale Research, Sabrient Systems, Wall Street On Demand, Thomson Financial, and Bank of New York’s Jaywalk Research Reports. For those with large accounts ($100,000+) Credit Suisse Research is also available. You can find the whole list here.
Pros: Wide offering of research providers; no fee IRA accounts
Cons: $12.95 stock trades; $1,000 minimum to open; non-IRA accounts must make at least one trade per quarter or are assessed $40 account charge
Bottom Line: At first glance looks inviting based on the amount of research available, but the $40 account charge on non-IRA accounts and $1,000 minimum to open puts me off. $12.95 for trades is also a negative. Objectively it could be higher, but hey it is my list and I just get the feeling that it is more of a bank with a lot of little fees here and there.
Pros: $6.95 stock trades, no minimum to open; no account fee
Cons: Only offers S&P reports
Bottom Line: Good pricing on stock trades at $6.95 and no minimum to open get it tied with Scottrade, but very limited research makes it a no go in my book.
No. 4-5 is E*Trade. Etrade offers $12.99 stock trades. The available research includes Reuters Research, S&P Reports, Rochdale Research, Sabrient Systems, Wall Street On Demand, Thomson Financial, and Bank of New York’s Jaywalk Research Reports. For those with large accounts ($100,000+) Credit Suisse Research is also available. You can find the whole list here.
Pros: Wide offering of research providers; no fee IRA accounts
Cons: $12.95 stock trades; $1,000 minimum to open; non-IRA accounts must make at least one trade per quarter or are assessed $40 account charge
Bottom Line: At first glance looks inviting based on the amount of research available, but the $40 account charge on non-IRA accounts and $1,000 minimum to open puts me off. $12.95 for trades is also a negative. Objectively it could be higher, but hey it is my list and I just get the feeling that it is more of a bank with a lot of little fees here and there.
Tied No. 4-5. is Optionsxpress. Optionsxpress offers stock trades for $14.95 with no minimums to open and no account fees. Optionxpress provides free access to Morningstar stock reports.
Pros: Morningstar research; good tools for option traders; no minimum to open, no fees on any account
Cons: Stock trades are $14.95; only offers Morningstar stock research
Bottom Line: No hidden fees at all is a big plus as is no minimum to open, but $14.95 for stock trades is a negative (if the trade cost was under $10 I would have put them at No. 3). While it is limited in research to Morningstar Stock Reports it is the only broker to offer access to Morningstar so that gives it a slight edge to E*Trade in my book. Note: For those interested in Health Savings Accounts (HSA) Optionsxpress is one of the very few ways you can actually set up an HAS account and trade normally.
No. 3 is Muriel Seibert. Trades are $14.95. No minimum to open and no account fee except on IRA’s less than $10,000 ($30 per year). Seibert offers the following research: Standard & Poor's Reports, Zacks Research, Reuter’s Multex, ProphetFinance, Validea, MarketEdge®, VectorVest®, Growth Stock Analytics, Lehman Brothers, and Thomson Baseline.
Pros: No minimum to open, wide variety of research
Cons: $14.95 to trade, $30 a year on IRAs less than $10,000
Bottom Line: Good selection of research. $14.95 to trade is a negative as is the $30 per year charge on a IRA. But it offers a wide variety of research with a couple of unique products not offered elsewhere. If there is some specific research provided which is something you are looking for than this may be the choice for you. It gets the nod over E*Trade based on no minimum to open and over Optionsxpress based on the amount of research. If Seibert cut its trade cost and got rid of the $30 IRA account fee it could challenge for the top two spots.
No. 2 is Fidelity. Fidelity has stock trades for $19.95. There is a $2,500 minimum to open but no account fees. Research is extensive: Argus Research, Ativo Research, LLC, Channel Trend, Columbine Capital Services, Decision Economics, Ford Equity Research, Lehman Brothers, Market Edge, Ned Davis Research , Prudential Equity Group, Standard & Poor's Reports and Outlook, Thomas White International, Thomson Financial, and Zacks Research .
Pros: Lots of Research, No account fees, local branches
Cons: Trades are $19.95, $2,500 minimum to open
Bottom Line: While the trade price is high at $19.95, the amount of available research makes Fidelity one to consider. Also, many investors might have a 401(k) here and that may make it easier to keep everything in one spot. The trade cost and large minimum to open kept it out of first place.
The No 1 pick is TDAmeritrade. Stock trades are $9.99. Minimum to open is $1,000 for IRA accounts and $2,000 non-IRA. Research includes : S&P Reports and Outlook, Vickers Stock Research, Thomson’s First Call, The Street.com Ratings, Ford Equity Research, and Thomson’s Market Edge.
Pros: $9.99 stock trades, lots of research, no account fees
Cons: $1,000/$2,000 minimum to open
Bottom Line: TDAmeritrade offers good selection of research and a low trade price. While the minimum to open is a drawback, overall I would say TDAmeritrade deserves consideration and gets a slight nod over Fidelity based on the trade cost.
In the end I like Fidelity for the selection of research and if I based it solely on that I would say that it would be No. 1. But TDAmeritrade is no slouch in research and offers a trade cost half as much as Fidelity’s so it gets the nod as No. 1, but just barely.
Overall, any one of these brokers is a good deal, and my 1-5 are all solid choices. While I have ranked them as a means of separating them relative to each other, they all provide more value than they ask for. That is because anyone of the brokers is offering several hundred dollars worth of research just to open an account, in some cases with no minimum, and at no annual cost. Pretty good bargain for any investor.
Saturday, March 03, 2007
Blog Review: Afraid To Trade - Overcoming Stock Market Fears
Afraid To Trade: Overcoming Stock Market Fears
Another new blog I like to read is Afraid To Trade: Overcoming Stock Market Fears. As the name implies this blog is focused on addressing the common fears individuals have when it comes to trading. Whether it is buying, selling, or holding, a large part of stock market success is controlling anxiety and fear. This blog endeavors to help investors overcome those fears.
As the blog author states "there are key behavioral and cognitive strategies that we can use to assist us in overcoming barriers that keep us from achieving our full potential." Many of the posts addresses those fears with topics such as How do my Emotions Affect Trade Targets?, Examining the Right Edge of the Chart - What do I do?, and The Four Fears of Trading.
Overall, this is a good blog to stop at to help understand the only thing about the stock market you can have 100% control of: Yourself.
Afraid To Trade: Overcoming Stock Market Fears
Friday, March 02, 2007
Cool Dude Eddie Daroza's Conquest Of The Web Continues
Cool dude Eddie of The Rad Report has begun a stint as a writer for The Blogging Times. If you like keeping up with what is going on in the blog world, Eddie is the guy you want to read.
Thursday, March 01, 2007
Warren Buffett Puts Out The Help Wanted Sign
Do You Have What It Takes To Be The Next Charlie Bucket?
As many of you know, Charlie Bucket was the name of the child who won a golden ticket to enter Willy Wonka's contest to select an heir to take over Wonka's candy business. Well today, all you aspiring Charlie Bucket money managers just got an invite from the investment community's version of Willie Wonka.
That's right Warren Buffett is looking for a crown prince or princess.
Today in Berkshire Hathaway's Chairman's Letter, Warren Buffett announced that, while he has several candidates to replace him as CEO, there is a vacuum with respect to someone young enough to replace him as Chief Investment Officer. Therefore, he announced (on page 17 of his letter) that he will begin a search to select a "younger" candidate or field of candidates to be groomed to replace him as investment officer when that need arises.
Note the word "younger." What, you thought he was meeting with MBA students cuz he liked kids? Man he was scouting talent.
So for all you "younger" money managers, MBA students, and the like, who have dreamed of learning from the master, spruce up that resume and dry clean your interview outfit. Your chance to get one of the golden tickets is at hand.
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