Investing Magazines – Are They Really That Useful? | By James Woolley
You will often see investing magazines on the shelves in your local newsagent, and they do seem to be quite popular with stock market traders and investors. I used to buy them myself in the past, but nowadays I don’t bother with them at all. So are they really that useful?
Well let me discuss some of the positives first of all. One of the major selling points is that they will often have some really good informative and educational articles. Every month they will often choose a topic and write a feature article on this subject, which may be two to five pages long, for instance.
So they may write feature articles about options trading, or they may discuss the 10 most undervalued stocks in the FTSE 100, for example. One thing you can guarantee is that these feature articles will nearly always be a very good read.
Another thing I like about share trading magazines is that they will often discuss individual stocks that you may not otherwise have come across. They will often pick out a few small-cap stocks that are worth keeping an eye on, and these can turn out to be great investments. Of course you shouldn’t buy stocks on the back of a recommendation. You should always do your own research as well.
These magazines also tend to have good coverage of the latest company results. This can be useful because you can scan through them and find out which companies are performing very well, and are therefore worth adding to your shortlist of possible investments.
Those are the positives, but there are also several things I don’t like about investing magazines. Firstly you always have to bear in mind that the people writing the articles about various different stocks are journalists first and foremost, so you have to be very wary about listening to any recommendations. If they were highly skilled investors, then they would probably be working in the city for a major investment bank, or trading their own money.
Another thing to bear in mind is that they will often brag about the share predictions that they got right. This encourages inexperienced investors to start blindly following future tips, which will often lead to disappointment, because they will rarely mention the numerous recommendations that turned out badly.
So as you can see, investment magazines have their good points and their bad points. Ultimately it is up to you whether or not you buy them every month. They are very often quite a good read, but you should always be careful about following any of their recommendations.