Software for stock pickers

Trade platform, forex trading. Stock exchange market analysis on laptop screen

(Image credit: Rawf8)

published 7 March 2017

Online tools make it much easier to analyse potential investments.

Private investors have a number of advantages over the professionals. They can take a very long-term view and don't need to worry about short-term performance targets, such as beating a benchmark index every year. They can buy stocks that are too small or illiquid for a typical fund to make a meaningful investment in or avoid big, popular stocks that many fund managers feel they must own. They can build a portfolio that's tailored to their objectives rather than something that needs to be broadly suitable for lots of investors. They can radically change their strategy when they feel it's necessary, rather than having to keep to a specific mandate.

In the past, they also had one big disadvantage: they couldn't get access to the same amount of research and data that professionals have, which makes it hard to find the best investment opportunities. Comprehensive data services such as Bloomberg and Reuters cost many thousands of pounds per years. However, there are now a growing number of websites that offer similar tools at prices that are more affordable for private investors.

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SharePad is a very powerful tool with a very neat, compact layout. For example, selecting a specific stock brings up a dashboard of key information about the company. The page also features a chart carousel that allows you to flip through graphs showing ten years of key ratios, such as profitability and leverage, providing a fast overview of how the company's fundamentals have evolved. You can then dive into more detail on subsequent pages.

In common with the other software in this review, there's a portfolio function that allows you to monitor the performance of your investments. Former MoneyWeek writer Phil Oakley also produces a weekly email for subscribers featuring analysis of individual stocks and tips on using SharePad. The regular price is £25 per month (or £60 per month for live share prices), but there is an initial trial offer of £25 for three months.

Like SharePad, Stockopedia features comprehensive company data presented in a way that makes it easy to get an overview of each stock. However, the easiest way to summarise the key difference between the two services is that while SharePad is geared towards identifying stocks that are good candidates for further individual analysis, Stockopedia focuses on quantiative screening and ranking as an investment approach in its own right. In other words, you might use Stockopedia to identify a basket of stocks that meet a certain criteria and buy them all.

The site has a large number of pre-set stock screens that are based on strategies used by well-known investors, as well as allowing you to build your own screens. It also calculates a "StockRank" for each company, based on factors such as quality, value and price momentum. The resulting number is essentially an assessment of how attractive Stockopedia's algorithms think the firm is as an investment.

In addition to UK stocks, Stockopedia also lets you subscribe (for additional fees) to data on firms in the US, Canada, Europe, developed Asia Pacific countries and India (underlying data in all cases comes from Thomson Reuters). Most of the rest of the world should be added over the course of 2017. This international coverage makes it a useful tool for global investors who don't want to subscribe to different services in each country. Complete coverage of all the markets currently available on the site would cost just under £1,000 per year and there is a 14-day free trial.

All Robur's fundamental data is compiled by its own team from company filings, rather than being bought in from data vendors. There are more than 6,500 stocks included so far, with more still being added. The database focuses mainly on European and Asian markets, including many markets in emerging Asia that are rarely covered by other screeners. Coverage of the United States is more limited since there are already plenty of comprehensive, cheap US stock screeners available and Robur decided that there would be little value in duplicating them.

Screening with Robur works in a similar way to SharePad or Stockopedia. You choose the criteria you want to narrow down a list of shares, then click to select a stock for further details. Each page includes a comprehensive set of charts showing the evolution of the company's financials over time. Each stock is also ranked using a "Robur Score" based on the site's own algorithms, based on how well the business is performing and how cheaply or expensively it's valued.

However, there are a few good sources of free stock data available online. Bloomberg's website at Bloomberg.com is a good starting point for quickly looking up share prices and a small amount of data such as the price/earnings ratio or the dividend yield. The Bloomberg app for iOS and Android includes slightly more data than the website version. The Financial Times website offers a wider range of data, including the last five years of company results.

However, the most comprehensive option is probably Morningstar so long as you know where to look. While Morningstar.co.uk is useful for researching UK funds, data for shares is far more limited than on the global Morningstar.com site, which includes companies from every major global market and many smaller ones. The data isn't perfectly presented and the site layout can seem overwhelming. But if you want a free source to look up a firm's return on equity for the last ten years or check when it pays dividends, this is the place to go.

Cris Sholto Heaton is an investment analyst and writer who has been contributing to MoneyWeek since 2006 and was managing editor of the magazine between 2016 and 2018. He is especially interested in international investing, believing many investors still focus too much on their home markets and that it pays to take advantage of all the opportunities the world offers. He often writes about Asian equities, international income and global asset allocation.

Cris began his career in financial services consultancy at PwC and Lane Clark & Peacock, before an abrupt change of direction into oil, gas and energy at Petroleum Economist and Platts and subsequently into investment research and writing. In addition to his articles for MoneyWeek, he also works with a number of asset managers, consultancies and financial information providers.

He holds the Chartered Financial Analyst designation and the Investment Management Certificate, as well as degrees in finance and mathematics. He has also studied acting, film-making and photography, and strongly suspects that an awareness of what makes a compelling story is just as important for understanding markets as any amount of qualifications.