Finding opportunities to invest can often be the hardest part but there are plenty of resources available to help you. As with anything, the more you practice looking for companies, and the more you become aware of opportunities, the easier your investing will become. There is no magic formula, and it is entirely up to you to decide but it is incredibly fun and rewarding searching for that next great stock. Below are some resources available to you to help you find your next investment. Full discussion in Episode 7 – subscribe now!
Finding companies, finding opportunities:
Your interests and experience: One of the best ways to find a company to invest in, or an industry to research, is by taking a look at what interests you. You may be interested in fashion, in sports, in cars or cooking and this is a great place to start. Something to try is to think of products or brands that you like, or that are selling well, and find out which companies are responsible for the product or service. Then put in some time to research the company and its competitors a bit further to help you form an opinion as to whether it’s a good opportunity for investment.
You may also have experience in an industry and this can help you find opportunities. For example, you may work in retail and as such have a better understanding of trends, market conditions, customer’s favourite brands or company performance. Use this to your advantage and as a starting point for your research.
Daily News: Almost everything that you read in the news can have an impact on your investing decisions. Try to be aware of opportunities when reading the news. For example, a cyclone up in Queensland can have a huge impact on companies, both positively and negatively. Insurance companies, building and construction, agriculture and retail will all be affected by the cyclone. Try to think how it will affect them and what it would mean from an investing point of view. Some great places for news:
Social Media: Social media is a fantastic source of up-to-date information, and what is trending now. Investors love to share their advice, thoughts, and latest finds. Businesses use social media to to spread information as well, so it can often be a great place to start looking for opportunities and getting ideas.
- @AlanKohler – ABC News/The Australian Finance
- @AsennaWealth – Head trader at his fund
- @David_Scutt – Macro trader
- @TheKouk – former senior economics advisor to Julia Gillard
- @JamesGlynnWSJ – WSJ journalist based in Sydney
- Equity Mates Podcast
- Business Insider
- Financial Review
- Smart Investor
- Barefoot Investor
Investor communities and forums: These are fantastic sources of information. You will find a lot of hidden gems in communities online, as investors share their latest finds, hot tips and tricks. It is very important to remember that when you are reading through communities and forums that you form your own opinions, and don’t take others word as gospel. Some brilliant forums are:
- HotCopper www.hotcopper.com.au
- Motley Fool
Company specific information:
Once you’ve found a company you may be interested in, it’s then important to go a do some further research so you can form a thesis about the company. There are some great tools out there to help you do this.
Company annual reports: Each publicly listed company is required to produce an annual report that details everything from their financial performance through to their strategy for the coming years. It’s a fantastic resource to get a lot of specific information about the company. The reports can be long and sometimes there will be sections that you don’t understand however each report will have an executive summary that you should at least read. The reports can be found on the ASX website, through your brokerage platform or on the company’s website.
Google/Yahoo Finance: Google and Yahoo both provide great financial information about listed companies. All you need to do is type in the ASX code for the company and away you go. The information is presented in an easy-to-read format and is often our first stop when we want to find out the latest financial information about a company.
Your broker platform: Your brokerage platform is a fantastic place to start getting specific information about your company. Often they will have ratings, archives of annual reports, financial information, as well as information on competitors and the industry. Have a look around on your provider – you will be surprised how much information you can get.