| If you tell people that you play the market, | | | | insulting their intelligence. The good news is that |
| they're likely to respond in one of two ways - | | | | SmartMoney offers in-depth profiles of many |
| either they want you to give them investment | | | | stocks and other investments in each issue. |
| advice, or they think that they're experts and | | | | It is also faithfully honest about its best and worst |
| they want to give you investment advice. | | | | picks, and it routinely reviews how its investment |
| Today, investment advice is everywhere, but | | | | selections have performed over the past year. |
| investors should beware - free investment advice | | | | Forbes is slightly different type of publication, with |
| is usually worth exactly what you pay for it - | | | | a somewhat more affluent and conservative |
| nothing! | | | | audience. While SmartMoney is geared towards |
| Using a Stock Broker for Investment Advice | | | | upper middle class investors with a few hundred |
| All too often, stock brokers are trained | | | | grand in their 401k's, Forbes is more for the |
| salespeople, more so than trained financial | | | | executive-level investor with a few hundred grand |
| professionals. Before you act on any investment | | | | in annual contributions to the Republican Party. |
| advice from a stock broker, make sure you | | | | This does not mean, however, that Forbes is not |
| understand how the broker is paid. Do you pay | | | | a good publication. It does devote a full 1/3 of its |
| him a fee specifically to give you investment | | | | pages to investment advice, and while its |
| advice? | | | | investments articles are not as in-depth as |
| If so, does he have any other incentives to | | | | SmartMoney's, they are well-written and concise - |
| advise you to buy a certain stock or financial | | | | and sometimes that's just as good. |
| product? Stock brokers are legally required to | | | | Using the Internet for Investment Advice |
| disclose any conflicts of interest when giving | | | | There are numerous online sources of investment |
| investment advice, so make sure you ask. | | | | advice. Yahoo! Finance publishes articles and relays |
| Or, if you're not paying your broker specifically | | | | analyst opinion. has many premium products that |
| for investment advice, you need to ask him if he | | | | give comprehensive recommendations. But easily |
| receives a higher commission from the product | | | | the most famous website for investment advice |
| he's recommending you buy than from other, | | | | is MorningStar (morningstar.com). |
| comparable products. | | | | MorningStar is best known for its mutual fund |
| Using CNBC for Investment Advice | | | | reviews, but it also publishes research reports on |
| CNBC is a 24-hour business news channel, and | | | | individual stocks. However, MorningStar has come |
| throughout the course of day, dozens of stock | | | | under increased pressure lately as many of its |
| market pundits appear on screen to give | | | | picks have failed to pan out. |
| investment advice. To disclose all possible conflicts | | | | MorningStar assigns stocks ratings of one to five |
| of interest, CNBC displays an on-screen graphic | | | | stars, and critics charge that the company will |
| detailing if the pundit owns any of the | | | | give a bad stock a good rating, and then as the |
| investments he's advising you buy, or if his family | | | | share price falls, MorningStar upgrades the stock - |
| or firm do. | | | | saying it's fallen too far and is now a great |
| However, the biggest risk in using CNBC for | | | | bargain. |
| recommendations is that much of the investment | | | | The problem? The stock sometimes continues to |
| advice is distilled into minute sound bytes. This | | | | fall. In the case of certain stocks like Microsoft |
| results in an incomplete picture, in which you may | | | | (MSFT) and eBay (EBAY), MorningStar may soon |
| not fully understand the pros and cons of a given | | | | have to create a sixth star to give them as they |
| stock or other investment vehicle. | | | | continue to plummet in value. |
| Using Magazines for Investment Advice | | | | The message is - beware of all investment |
| There are numerous magazines that dispense | | | | advice. Get your recommendations from multiple |
| investment advice. The best among them are | | | | sources, always check the advisor's track record, |
| probably SmartMoney and Forbes. | | | | and be wary of any potential conflicts of interest. |
| SmartMoney is geared towards somewhat less | | | | And the next time your brother-in-law tries to |
| sophisticated investors, however, Wall Street pros | | | | give you some investment advice, refer back to |
| can read and enjoy the publication without it | | | | the first paragraph of this article. |