What Are Effective Online Investing Tools?

There are various online investing tools that are available to assist you in effectively managing your investments. These tools help both experienced investors and novices navigate the word of investment by analyzing, screening and managing the selections for your portfolio.

The online investment tools are as effective as the individual using them is. They offer different levels of either complexity or ease of use and can be tailored to select specific types of investments that meet your investing criteria.

Investment Screeners
An investment screener is a tool that helps an investor select different investments based on broad criteria. The screener looks at different types of investments and asks questions in order to determine your preference for different investments, ranging from socks to mutual funds. A screener can look at the whole universe of investments, by category and give you a list of the ones that are bested suited based on your selection.

Advantages
•Helps you wade through the thousands of individual investments available to choose from.
•Gives you a way to set a criterion for the types of investments that you are interested in.

Disadvantages
•The investments that are given because of the tool are based on a subjective criterion that may not properly reflect your financial goals and objectives.
•The tool does not select individual investments for you and cannot decide between similar types of investments within the same category.

Research Tools
A research tool helps the investor analyze individual companies and stocks and determine the advisability of including the investment in your portfolio. This tool is the basis of an investment analyst’s recommendations and gives you similar information as to the company’s history, financials, market presence and other comparative data.

Advantages
•The research tool allows you to better hone your investment choices and make choice between similarly screened investments.
•It gives you a detailed analysis of an investment for comparative purposes.

Disadvantages
•The tool provides a snapshot of the investment at the time of the report and may not reflect new trends or recent news concerning the investment.
•It is labor intensive and requires a lot of knowledge about financial reporting, analysis and accounting.

Portfolio Managers
A portfolio management tool helps keep your investment portfolio in balance with the stated goals and objectives that your have with investing. This tool helps to diversify and keep your portfolio in balance with changes in the market and helps make asset allocations that are in keeping with your risk tolerance and desired portfolio return.

Advantages
•Portfolio management tools help remove some of the guesswork associated with investing.

Disadvantages
•The tool provides information based on the subjective criteria that you create.

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