Over the past year or so, I’ve had quite a few subscribers ask about Stockopedia PRO and whether it’s worth subscribing to both Stockopedia PRO and UK Value Investor. The short answer is this: while it may seem as if we provide many similar things, I actually think each complements the other quite nicely.
If you’re not familiar with Stockopedia, it’s a website that was set up in 2007 with the tagline of being “the first social network for UK private investors”. That may have been the case in 2007, but these days the main draw of the site (other than the discussion pages where you’ll sometimes see articles from yours truly) is Stockopedia PRO, their premium service.
Both Stockopedia PRO and UK Value Investor provide stock screens, model portfolios and data on individual companies and shares. Where we differ is how we go about it:
Stockopedia PRO is about choice, while UK Value Investor is about focus
We both allow our subscribers to go far beyond PE ratios and dividend yields. In each case, this is done by taking raw data from company accounts and turning it into something which is hopefully more powerful, based on rigorous academic research.
I’ll get the disclosure out of the way first: I have a mild business relationship with Ed and Dave (head honchos over at Stockopedia), where we collaborate in certain ways, e.g. suggesting features or offering discounts on the other’s services to our subscribers. This article certainly isn’t a paid advert, and I would have written it primarily for UKVI subscribers, even if there were no links between us.
Stock screens
Most investors like stock screens because they allow you to quickly hone in on those stocks you’re likely to be interested in. Simple, free screens allow you to screen based on PE ratios, yields and occasionally more complex factors, while Stockopedia PRO and UK Value Investor offer screens that are pre-built for a particular investing style.
Lots of choices
Stockopedia PRO’s screens are wide-scope, with at least 65 screens covering Quality, Growth, Short Selling – you name it, and there’s probably a screen for it.
Some screens are based on famous formulas, like the Magic Formula or Piotroski’s F-Score, while others are based on investors like Warren Buffett, Ben Graham or Peter Lynch.
If you dig into each screen’s page, you’ll find a description and details on the rules of the screen and the thinking behind the stock-picking strategy.
Of course, I’m going to say that if you’re after high-quality, high-yield stocks, then I think the UK Value Investor screen is the best. But if you like to go beyond those quality value stocks and look at small-cap growth stocks or deep value plays, then Stockopedia can be a great addition, even if you already subscribe to UK Value Investor.
Highly configurable
One powerful feature of Stockopedia’s screens is that you can ‘fork’ existing screens and create your own version, which you can then tweak to your heart’s desire with a huge range of screening factors.
If you want to bend the Magic Formula with high dividend yields, that’s easy, and your combinations can be as wild or as simple as you like.
I will issue one warning here, though:
It’s important that you know what you’re doing when you start building your own stock screens. There’s a reason that the UK Value Investor screen is fixed, and it’s because I want to make my subscriber’s lives easier, and having a fixed screen is one less thing to think about.
It can take years of study and real-world experience to be able to put together effective screens, and Stockopedia’s screens can be a great way to learn about screening, but just remember to treat them with care. If you’re new at this, then perhaps stick with the default screens for at least a while.
Having said that, if you want a wide range of choices with lots of flexibility and configurability, then the Stockopedia stock screening tools are the best I’ve seen.
Summary – Stockopedia PRO screens are many and flexible, while the UK Value Screen is singular and deeply focused.
Stock reports
This is one part of Stockopedia PRO where UK Value Investor subscribers, and others, of course, may see the most value.
If you’re a UK Value Investor subscriber, then you already have access to a unique and, in my opinion, very powerful screen and a human-managed model portfolio which demonstrates a complete approach to high-quality, high-yield investing.
However, what you won’t have access to is reams of data on a vast number of different stocks.
A huge range of fundamental factors
That’s where Stockopedia PRO comes in. It has a huge number of factors available for use in the stock screens, and they are also visible on each stock’s ‘report’ screen. I’m pretty sure that almost everything you could imagine as being useful is in there.
Price to book, price to sales, price to cash flow, PEG ratio, operating margin, pretty much all the financial data for the past six years, broker consensus, valuations using all manner of different approaches… I could go on all day. And it all looks very clean and modern to boot.
Another warning, though – Despite us humans having up to 500 trillion synaptic connections in our brains, there is only so much information we can digest (unless you’re Warren Buffett, who can, according to many accounts, memorise whole books virtually verbatim just by scanning each page).
The point is that you need to know what factors you are interested in and be able to ignore the ones you’re not interested in. Knowing what you’re interested in and what you’re not interested in can take many years of research, so again, treat this tsunami of information with care.
Summary – Stockopedia PRO gives you a huge range of basic and advanced fundamental factors, while UK Value Investor provides a small number of unique, tightly integrated factors.
Portfolio analysis tools
This is another feature that I really like and which I know is of interest to some existing UK Value Investor subscribers.
From personal experience, I know that most of the stock broker websites out there are visually and informationally bland. One of the things I’d like to see is a breakdown of a portfolio’s size allocation and sector allocation. Stockopedia PRO allows you to do the same for your own real money or virtual portfolios.
Just enter your current positions, and you’ll get to see the performance and fundamental data for each holding, as well as total profits and losses (although profits are generally preferable).
But there’s more. Just click on the ‘analysis’ tab, and you get a chart of your performance, an asset allocation breakdown (e.g. cash and equity percentages), as well as aggregate ratios for the whole portfolio like PE, EPS growth, dividend cover, etc.
Click on ‘allocation’, and you’ll see sector breakdowns, a value/growth and large/small ‘Morningstar’ style grid, and sector weightings versus the market average.
If that’s not enough, you can even see all the latest regulatory news items for all your holdings, plus upcoming events like dividend payments, results announcements and AGMs. You can subscribe to the events in your computer’s calendar too.
All in all, this is very nice, and when automatic dividends are in place (possibly later this year), it will be even better.
Overall conclusion
I’ll start with what I don’t like. There’s not much I don’t like to be honest, but I would say that the breadth and configurability of Stockopedia PRO may be too much for some investors, either those who don’t know what they’re doing or those who can’t stop themselves endlessly tweaking everything.
Something that I’ve focused hard on with UK Value Investor is minimising distractions and focusing on the few things that have a high signal-to-noise ratio, in other words, those things that really matter.
On the other hand, if you do have a reasonable amount of knowledge and/or self-control, then Stockopedia PRO offers some amazing features, all wrapped up in an attractive and simple-to-use design.
By combining UK Value Investor with Stockopedia PRO, you can get the focused approach of one with the advanced tools of the other.
I do not get why an investor will look at so much information. In investing having more information is worse than having more information. You get your head buried in so much figures, much of those figures being past history. As Warren B. said ‘if investing was only about reading past figures, the most succesful investors would have been librarians.’
Secondly you need to have a circle of competence. For example I don’t understand banks at least in the form they are now. I knew they were cheap last year but I want to buy a stock to hold it at least 7-8 years and have less volatility.
I do understand industrials but I only buy shares have predictible earnings like Rolls Royce. It costed them a hell of a lot to develop the Trent engine but what a market there is now for it.
Hi Eugen, there is a lot of info on Stockopedia, but I think generally the idea is that it caters to a wide and diverse audience, so each member picks and chooses whatever it is that they’re interested in. But as I said (and as you just said) it does create the temptation of looking at everything and getting lost in the noise… but I guess that’s why they invented will power.
There are a number of these services around and the above are by no means unique. For US stocks there is Validea http://www.validea.com while for Canadian stocks 5i research provides a fairly cheap alternative http://www.5iresearch.ca. Of these Validea sounds very similar to Stockopedia and UK value investor, with various value screens such as Buffet and Graham. Personally I like 5i research because for a fee of under $100 a year you can get any question answered about a stock and they cover most Canadian and many US names.
If you want to do it yourself there are a number of good stock screeners which are free. In the UK Halifax, Daily Telegraph, Financial Times and HSBC provide powerful stock screeners. All except the last of these is free. The trick of course is how to use them. Here the Toronto Globe and Mail has an excellent investor education section which explains how to use screens. Although focused on N American stocks they do sometimes have UK articles and naturally the principles of value investing are universal.
http://www.theglobeandmail.com/globe-investor/investment-ideas/number-cruncher/
Hi Andrew, thanks for those links, I’m sure those who invest in the North American markets will appreciate it. Validea is very similar to the “guru” screens in Stockopedia, and John Reese’s book The Guru Investor is one of my favourites. Of course there are differences with all these things, like Stockopedia having a far wider scope and configurability, and UK Value Investor having a human applying the investment system, rather than just a computer.
As you say it is the sensible use of screens which really makes the difference, because a screen is just a tool. That’s why with UK Value Investor I like to go further and cover wider issues such as portfolio diversification or the emotional side of investing.
Thanks again for the North American links,
John