Using the Internet to Maximize Your Investment Success
 By Nancy Zambell, Contributing Editor

I've just returned from the San Francisco Money Show, where I'm happy to report, investors are actively engaged in managing their own financial lives.
 
 When I began my career in the financial industry 25 years ago, most investors used full-service brokers, still suspicious of the "new" discounters who made their debut in 1975. But over the years, the pendulum has swung in the other direction, with the majority of investors now transacting most of their stock trades via the discount firms.
 
 The big lure, of course, has been the rapidly declining commission rates, but accompanying those lower transaction costs has been a tremendous explosion in investor education.
 
 In the old days, investors were more than content to turn over their money to a pro. But scandals and losses in the industry propelled investors to find their own way. And fortunately, an array of tools -- books, seminars, financial shows and the Internet -- have made that transition not only possible, but very profitable for many folks.

I love this development, as it means that when I speak at the various Money Shows around the world, I am talking to interested, self-starters who really want to learn about investing. Unfortunately, this great wealth of information has a downside. There's so much of it to process! And, unfortunately, a sizeable portion of the information is not only not beneficial to investors, it can be downright detrimental.

Therefore, investors who don't spend their lives glued to a computer screen (as I do!) often need a guide to help them discern which sites are truly helpful and which are not.

Consequently, each of my workshops includes a segment on how to find the information investors need on the World Wide Web, and I am going to share some of my favorite sites with you today.

My favorite websites

The number one question I hear at my workshops is "How do I find potential stocks?" For years, I paid for a fancy software system that worked very well for me, but as the Internet advanced, I found that I could do essentially the same analysis at several websites – for free!

I am constantly searching for new and better sites, and so far, these three seem to offer what I need for screening stocks. Each site allows you to enter a number of parameters (fundamental and technical) and their screening tools are more than adequate for most investors:

http://www.zacks.com/research/screening/index.php?PHPSESSID=c761
http://moneycentral.msn.com/investor/finder/customstocksdl.asp
http://screen.yahoo.com/stocks.html

If you are seeking mutual funds or exchange-traded funds (ETFs), here are my favorites. At these sites, you can often find ratings, as well as information on returns, expenses, turnover and portfolio holdings:

www.morningstar.com
www.finance.yahoo.com
www.amex.com
www.nasdaq.com

For investors interested in dividend reinvestment plans (DRIPs) and/or direct stock purchase plans (DSPs), these sites are excellent:

www.better-investing.org (which offers a Low Cost Monthly Investment Plan for more than 100 DRIPs)
www.sharebuilder.com (which allows you to pool your money with other investors to buy shares)
www.dripinvestor.com

Investors looking to buy shares in foreign companies through American stock exchanges may be interested in purchasing American depository receipts (ADRs). These comprehensive sites will give you information on hundreds of ADRs:

http://www.adr.com/
http://www.adrbny.com/home_dr.jsp

Once you develop a list of good prospects, your next step is to roll up your shirt sleeves for more in-depth company research.

My all-time favorite site for stock research is: http://finance.yahoo.com. All you need to do is enter the company's stock symbol and you can access information about the products of the company, its officers, expected and historical earnings, the activity of its insiders, company news and its financial statements.

I use the Reuters site, at www.reuters.com, almost as much as Yahoo. On Reuters, you will find financial statements, ratio comparisons to your company's industry, sector and S&P 500, historical and forecasted revenue and sales growth, and institutional ownership and activity

For comprehensive financial statements, you can go to www.sec.gov/edgar.shtml to access the SEC's Edgar system. There, you will find regulatory reports, including Form 10-Q (quarterly financial report), Form 10-K (annual financial report), Form 8-K(special announcements) and Form 4 (statement of changes in ownership)

If you are not currently a fan of reading financial statements, I encourage you to become one. There is no other source for really getting to know a company and its history, ideals and forecasts for the future.

For keeping up with stock, market and economic news, I love to read BusinessWeek and Forbes, but often don't have the time to do the entire magazines justice. So, I take a shortcut to: www.businessweek.com and www.forbes.com.

For investors interested in fixed income, here are a few sites worth visiting:

http://www.treasurydirect.gov/
www.bondsonline.com
www.moneycentral.msn.com

Additionally, to check out bond ratings, you can call the rating agencies:

Moody's: (212) 553-1658
S&P: (212) 438-7307
Fitch: (212) 908-0500

The growth of the Internet has brought the investing world to our desktops and has given investors tremendous opportunity for successfully managing their financial lives. If used wisely, (and skeptically, too!), it can make a very profitable difference in your portfolio.

This concludes this week's issue of Financially Fit.  We encourage you to visit our website to review past issues of Financially Fit:

http://www.brokeradviser.com/newsletter.cfm


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