Read company annual reports for red flags

Research suggests that careful reading of a company's annual report can pay off. In particular, says Matthew Partridge, there are four “red flags” to watch out for.

Every listed company has to release an annual report at the end of the financial year. It's often packed with promotional filler, so it can be tempting to skip the verbiage to focus on the figures. Don't. Research suggests that careful reading can pay off. In particular, there are four "red flags" to watch out for.

Lack of clarity

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Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri