Avoiding Information Overload When Researching Companies
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Avoiding Information Overload When Researching Companies
You shouldn’t feel bad if you can’t read every article from every source that comments on a company you’re researching. In your journey to becoming an informed stock investor, you’ll almost inevitably feel overwhelmed from time to time by the vast amounts of information available. Fortunately, you don’t need to read it all to be successful. In fact, some information may actually harm your performance by taking your focus away from what’s truly important. That’s why we’ve highlighted the key pieces of information you will need to make an informed decision.
Let this guide you
Here’s a quick step-by-step guide to becoming informed about a company:
1. Obtain the firm’s 10-K and really try to give it a thoughtful read. Don’t feel bad if you spend a lot of time on this step. (Give it a couple of days to digest.)
2. Read through the 10-Qs when they are released each quarter. These are usually much shorter than the 10-K and shouldn’t require more than an hour or two of your time.
3. Set up a watch list to organize the steady flow of news on all the companies that interest you.
4. Poke around on the company’s Website. This takes less than a half hour.
5. When time allows, visit relevant industry Websites and catch up on some of the industry trends.