There was an article published on stock screens in the last edition of the ShareSoc Informer Newsletter which has just been issued. It reviewed a number of published screens and the performance overall was poor, mainly because few of them tipped mining or oil sector stocks.
So how did the national newspapers share tipsters perform in comparison? Private Eye just published a report on that subject. It said only one national newspaper, the Sunday Times, beat the index with its collective tips. Most failed to get even close with the Guardian being the worst at minus 12 per cent.
The Telegraph only managed an average gain of 5% and the Times only up 2.4% (in comparison with the FTSE-100 up 14.4%). The wide spread on the individual tips from all the tipsters also suggests that they were picking speculative stocks or “special situations” which did not work out in a lot of cases.
Now I said in our last newsletter that my portfolio performance was disappointing in 2016, but I am feeling a lot better now as I made a reasonable profit and better than most of the “expert” tipsters it seems. Even experienced investor John Rosier who writes a diary for the Investors Chronicle managed to lose 4.1%, including dividends.
Perhaps the moral to be drawn from this news is that it might be best to do your own research rather than pick up tips from others and rely on them for investment purposes. Reading the national press or other publications might be useful for picking up ideas, but you should consider any tips with an appropriate amount of scepticism until you have researched the companies and fully understood what they do and their financial structure. In other words, don’t simply believe what you read.