When you are investing on your own you need to have the resources and tools to be able to research your investments and to manage your portfolio.  The sheer quantity of information available to you can be overwhelming.  Not to mention the quantity of investments available for you to buy.

Getting through all the information without spending weeks researching one investment can make you want to give up and find a financial planner.  Don’t give up just yet, there is one website that can help you sort through all the information out there, and begin to take control over your investments.

That site is Morningstar .  Morningstar has some great tools and resources to help you sort through all the data and also ensure your portfolio is in great shape!

For the remainder of this review we will cover the parts that I believe make the site worth using and a couple of things to be aware of when using the site.  (This is one of three things that I consider required for managing my money and have been using for over 10 years.  The other two are Quicken and Excel).

Free vs. Premium

They have both paid and free memberships depending on how much access to their tools that you want to have.  I personally have been a paid member for over 10 years now.

I pay for the premium service for a couple of reasons; access to their premium screeners and the x-ray feature on portfolios.  These two features alone save me tons of time and headache when looking for investments and the membership still costs less than hiring a financial planner.

What I would recommend is signing up for the premium and see if you need it.  You start out with a free 14 days so you can experiment with it – just remember to cancel if you are not going to use it.  (Add a reminder to your calendar to cancel it 10 days out).

Data Galore

It really does not matter if you are investing in mutual funds, stocks, or bonds Morningstar has enough data on every investment vehicle to help you make the right investment decisions.  For example on stocks, there are thirteen tabs of information about each stock and some of those tabs have sub-tabs with even more information.

Even without paying for the premium you can get information off of twelve of the tabs, you basically only miss out on their analyst’s opinions.  Which you don’t need to have in order to evaluate an investment if you have all the data at your fingertips.

Screeners

Most of the investments vehicles have a screener that will allow you to sort through all the options based on your requirements in an investment.  These screeners allow you to filter out what you know you don’t want and get down to a manageable number of investments to evaluate.  For example with mutual funds you can sort out for return, fees, inception date, tenure of managers. category and so much more.

You go from having thousands of choices to 10 or 15 that you need to really evaluate.  This is one area where having the premium membership is an advantage.  The functionality of the premium screeners in mutual funds and stocks is much greater than in their basic screener.  This feature alone saves me hours and hours of research.

Portfolio Analyzer

Sample Morningstar X-ray

I consider this the best feature in Morningstar .  You can create a portfolio in your account with all your investments and it will run for you an “X-ray” of your investments.  This includes your allocation to each of the assets, your stock style diversification, your region holdings, your sector holdings, stock overlap and so much more.

You enter how many of each investment that you hold and click a button and you have an inside look at your entire portfolio!

My only complaint on this feature is the time you must dedicate to entering the information on a watch list.  You are supposed to be able to import all the information into a portfolio, but every time I have tried this there are too many errors to sort through.

However once you have your watch list set up it is easy to make minor adjustments, and the time this feature saves is more than worth the few minutes it takes to update.  Also I have not found this level of information available on any other site.

Other Reasons Morningstar is Beneficial

• Market Information – Morningstar offers analysis on the market plus multiple breakdowns by sector, industry and other performance measurements.
• They are independent.  They make money through advertisements, memberships and their newsletters.  They are not trying to land companies to manage their IPO’s like the larger financial companies.  They have no outside interest other than good information.  (On the negative side of this they do sell most of their advertisements and licensing to the financial industry so there is still some level of bias there, just not as much as other analyst firms.)
• Discussion Boards – want to talk with other active investors?  There is an area for that!
• Education – now obviously I want you to come here to me for all your personal finance needs, but I have not been writing long enough to have covered every topic.  Morningstar has been around a lot longer and has a bigger team.  So if you can’t find it on my site, head over to their personal finance education section.

What I don’t Like about Morningstar

• As I mentioned earlier their portfolio import function does not always work so I use the watch list instead.
• The ETF screener is weak at best.  It would be nice if they could step it up and make it like the mutual fund and stock version of the screeners.
• There is a ton of information which is good, but I find that the site is not always intuitive to use and I have to do a bit of searching.  Since I have used it for so long, I know where most things are, but if you are just starting out you will have to give yourself some time to get to know where everything is on the site. (Drop me a note if you can’t find something and I can try and help).
• This one is a little bit petty, but it does take extra time.  When you are using the screeners there is not a back to list button, so if you go a few pages into an investment you have to use the back button to get back to the list.  If you don’t do this and instead simply go to the screener you lose your screened information unless you saved it.
• Don’t take their analysts word for everything.  While I read though the reports I only use that as one point for research.  As with any analyst review they don’t always look for the things in investments that you do.  Read it and then keep doing your own research.
• Don’t pay attention to the star ratings – these are based on history and remember we are looking to the future.

Things to keep in mind when using Morningstar to Analyze

There you go my review on Morningstar and why it is the best place to start and manage your investments.   Get started today taking control of your investment research!

www.takeasmartstep.com/youtubemorningstar

You can also follow along in my how to select an investment series here: how to invest in mutual funds .

Happy Investing!

Good review Andrea. Even though I subscribe to one of their tools geared towards financial advisors I still maintain my premium subscription to morningstar.com and I probably use it every day.

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