Weathered the storm? Here's a great way to keep tabs
BY TERRY SAVAGE firstname.lastname@example.org Jun 29, 2009
Updated: May 3, 2013 12:15PM
If you couldn't bear to look at your stock market investments in January, you're getting a second chance now. The mid-year statements from your 40l(k), IRA, mutual funds and stock brokerage accounts start to arrive in the mail. And the news should be better, since the market has had a nice rally from the lows of early March.
So here's a great project for you -- and a perfect time of year to do it. This is the time to set up a portfolio tracking system that you can check daily, and update automatically, so you'll always have your entire investment picture at your fingertips. And it's so easy you'll wonder why you never did it before.
Morningstar.com is the outstanding Web site for investment information on mutual funds and stocks. Less well known is its terrific online portfolio tracking section, complete with proprietary tools that analyze your portfolio and provide advice. A good portion of the information on the site is free, but there is a premium membership that costs $174 a year (or $18.95 a month). It's worth it if you want more personalized advice and analysis for your investments.
The "Portfolio" section of Morningstar.com is the perfect place to organize and track your entire investment portfolio. You can access it from any computer or use your iPhone, BlackBerry, or cell phone to access your portfolio at any time. You'll be able to see not only the current prices of your stocks and mutual funds, but also use some of the tools that let you track performance, compare with benchmarks, and check the Morningstar ratings on mutual funds and individual stocks. "Premium" members can also access the latest analyst reports and alerts directly from their PDA.
To get started, all you have to do is click on the "Portfolio" tab on the home page at www.Morningstar.com. Then you can set up one or more portfolios. This can be done by "importing" your account data as a direct download from most financial services providers and Web sites, including MicrosoftMoney and from online portfolio trackers at AOL, MSN, Quicken, and Yahoo!, as well as brokerage firms such as Fidelity, ScottTrade, TRowePrice and Bank of America, and some 40l(k) plans.
Or you can simply take your latest monthly statements and directly input your securities or funds, the number of shares, and your cost basis if you have it. There's even a "copy and paste" service to make this easier. (If you don't know the cost, but do have your purchase date, there is a special tool "Get Price" that will retrieve the closing price on the date of purchase.) Remember, cost basis is not as important inside a retirement account, since all withdrawals will come out as ordinary income.
You can set up more than one portfolio, and even create a "watch list" portfolio to follow stocks or funds that you're considering buying. Once you've set up your portfolio, the next step is to use the free tools that help you go beyond just "tracking" your investment performance, to help you understand the characteristics of your portfolio and warn you against over-concentrating in just one category of stocks.
Tools you can use
Now the fun begins. You can sign up for a daily e-mail service, letting you know how your portfolio is performing, along with links to news articles of interest. For example, if your security moves up or down 10 percent in one day, has a change in its Morningstar Rating, or has a change in fund manager, you'll be notified. Because Morningstar tracks more than 22,000 different funds and 24,000 stocks, the data is readily available.
Beyond tracking your portfolio, and beyond instant updates, there is an incredible range of help in dealing with your portfolio. And you don't need to be an expert to use these tools to make adjustments to your portfolio. Under the portfolio tab, just click on "Tools." That's where you'll learn a lot more about what's inside your portfolio and how all your investments work together -- or against each other!
The most useful feature of the Morningstar portfolio tracker is Portfolio X-Ray. To get the full benefits of this service, you must be a premium member. (But there is a limited Instant X-Ray feature available to all users.) Once you've created a portfolio, click on the X-Ray tab, and this feature looks inside your mutual funds to see the investments that each holds.
Next step under "Tools" is to click on "Asset Allocation." This lets you see the overall tilt of your portfolio-- whether to large cap companies or smaller companies, whether toward companies considered growth-style or value-style investments. It reveals how your sectors (consumer goods, health care, financial services, technology, etc.) stack up against the weighting of the Standard & Poor's (S&P) 500 Stock Index. You even get a report on the fees and expenses you're paying, compared with the average mutual fund. There's another feature of the premium membership called "stock intersection." It actually looks at individual stocks inside your mutual funds to let you know where their holdings overlap.
This may be more than you ever wanted to know about your investment portfolio. But if you want to converse with others, you can even join the "Discussion" and get helpful ideas or commiseration. Burying your head in the sand about your investments will only make your investment picture more gloomy. Be brave. Take a very close look at your investments, and you'll be better off in the long run. That's the Savage Truth.
Terry Savage is a registered investment adviser. Distributed by Creators Syndicate.