On-Line Portfolio Managers
Note that even with the advances made with Web-based tools, on-line monitoring tools do not offer the same capabilities as the top portfolio management software programs. Rather, they are best seen as tools for keeping you abreast of what is happening with your portfolio and notifying you of current events that might affect your investment holdings. Only GainsKeeper goes beyond the portfolio monitoring function located on most Web sites to provide a complete system that tracks all of the transactions in your portfolio to compute the capital gains for tax reporting purposes.
An on-line manager is like a personal assistant, helping to monitor the activity of your portfolio. On-line portfolio managers do not profess to do what software can do. They can track a portfolio quite effectively, but they do not generate reports or calculate returns to the degree that software does. However, they are clearly heading in that direction.
On the other hand, alerts and easy access to timely data make on-line portfolio managers a valuable complement to any portfolio tracking software program.
Not Suited for Everyone
Having said all that, on-line portfolio systems are not for everyone. The sophisticated investor, trading everything from equities to derivatives, will not be able to monitor all holdings. The majority of the applications discussed here are geared toward the type of monitoring done by the typical individual investor, whose holdings are comprised primarily of stocks and mutual funds.
Before going out and test-driving any on-line tool, it is a good idea to first develop a checklist of specific features to shop for and be aware of when comparing applications. For on-line portfolio management, these features include:
- frequency of updates,
- automatic refreshing of display,
- desktop software compatibility,
- links to brokerages,
- links to newswire services,
- E-mail alerts,
- access to additional analysis tools,
- number of portfolios that can be tracked,
- number of securities that can be tracked per portfolio, and
- types of securities handled.
Perhaps the most important elements of the checklist are the frequency of the updates and whether a portfolio display is updated automatically or manually by the user. News, additional tools, and overall activity reporting are of great benefit, but the tracking, maintenance, and refreshing of holdings are the key functions desired by all investors. Some investors are so accustomed to refreshing the prices of their holdings on their own that they would rather do it themselves. Others welcome a site that takes the task off their hands. In most cases, portfolios are refreshed automatically every couple of minutes or so while the user is at the site. Some sites establish a static timeframe that cannot be changed, while others allow the user to adjust the interval to an automatic display update schedule they desire.
In some instances, though, portfolios need to be refreshed manually by clicking the Refresh button on your browser software.
One unique feature available with some on-line portfolio managers is also found on certain portfolio management software products—a direct import function for transferring portfolio data from a desktop software program to your portfolio tracker on the Web. Sites offering this import feature also allow for “in sync” data updates—where changes made to on-line portfolios can be reflected in desktop software portfolios. With certain programs, this process of adding changes works in the opposite direction as well.
Some of the on-line portfolio management systems allow transactions to be imported directly from your discount brokerage service. This import function works like a dynamic link to your brokerage account. When a change is made to your account holdings—say you purchase 1,000 shares of a new stock—you simply log into your on-line portfolio manager, import your brokerage account, and recent changes will take effect in your on-line portfolio. This frees you from the need to record activity yourself manually.
On-line portfolio managers offer direct links to newswire stories and news headlines on the companies you currently track in your portfolios. These news stories are often located right on the portfolio’s current holdings view or transactions view as well as within a separate display dedicated just to news stories, news headlines, and press releases.
Newswire services range from the standard set (AP, Business Wire, PR Newswire) that can be found almost anywhere on the Web to a higher tier of limited-access newswires and news resources (Dow Jones, Reuters) to unique news outlets such as TheStreet.com. In most instances, links are provided to complete news articles, while other times merely news headlines are given.
This is a basic feature offered by all the sites reviewed here. The depth and breadth of coverage is what can set some sites apart from others, as does access to any subscription-based market news, such as those stories and reports from The New York Times, TheStreet.com, or the Wall Street Journal Online.
Perhaps the most significant feature that helps differentiate an on-line portfolio manager from a software program is E-mail capabilities. An E-mail alert can warn you of possible danger to your portfolio (a stock falling below a price target) or merely notify you of general activity (a stock split). Alerts can also convey something as simple as a dividend being declared for one of the stocks that you own.
E-mail alerts are not junk mail and they do not clog up your inbox with unnecessary messages. E-mail alerts are set up in a user profile and notify you of events happening only to the securities you select from the ones you are tracking, either in your primary portfolios or your “watchlists” (more on this later).
Additional Analysis Tools
On-line portfolio management systems offer access to an abundance of additional tools for further research and analysis. For example, most sites that offer a portfolio manager also offer stock or fund screening to find and research additional investment options. Assessing the quality of these additional tools can greatly aid in the evaluation of the portfolio tracker.
The most popular tools include stock and mutual fund screening modules, interactive technical charting applications, and financial planning assistance. With screening modules, be sure to check out the depth of data and number of data fields available for screening—two key factors that help differentiate these tools. In terms of charting, the availability of technical indicators and user-defined timeframes are just some of the things to look for. Other valuable features include access to fundamental data, earnings estimates, company and fund reports, market statistics, and any financial calculators.
Access to such tools is quite variable, but the functions are offered in some capacity by all the sites reviewed here. Only two sites do not have complete offerings based upon the tools surveyed. The depth of data and the degree of functionality of the modules are what can set some sites apart from others.
Number of Portfolios
The number of portfolios that can be tracked at these sites also varies and might prove to be an initial criterion that quickly narrows your choices. The number ranges from a single portfolio to an unlimited number of portfolios.
Most, if not all, of these on-line portfolio tracking systems will allow you to track a portfolio of stocks or mutual funds that you do not own but would like to keep an eye on. Referred to as a “watchlist” or “watch” portfolio, the data entry is done differently for this type of portfolio. Also, the monitoring measures are set up a little differently for watchlists, so you can judge whether these securities would make good investments.
The last item on our shopping list is the types of securities that can be tracked by the portfolio manager module. This element is the simplest factor to use to determine whether or not an on-line portfolio manager is right for you. As mentioned earlier, these on-line tools are not for everyone—especially the sophisticated individual investor. If you own investments beyond stocks, funds, and bonds, these tools might not provide the capabilities your portfolio requires. Only a few services track investment instruments other than stocks, mutual funds, and bonds. The specific coverage of securities is noted for each Web site in the descriptions that follow. Most allow users to track a cash balance, and most can include major indexes for comparison and monitoring purposes. Each site allows you to get quotes on any stock or mutual fund included in their particular database.
Comparing Apples to Apples
In addition to the previously mentioned checklist of specific features to consider when selecting an on-line portfolio manager, the on-line tools in this comparison were surveyed against the same criteria used in comparing traditional portfolio management software titles. This includes securities and transactions handled, as well as security classification, standard report offerings, the various portfolio performance reports, and any necessary user reporting options. This “apples to apples” comparison helps to demonstrate how the on-line portfolio trackers stack up against the competition and, in most cases, show that these tools are not to be used as replacements of software, but as complements to your core portfolio management program.
|ON-LINE PORTFOLIO MANAGERS|
Business Week Online combines editorial content from McGraw-Hill publications such as Business Week and S&P Outlook with data from Reuters, S&P, Telescan, and Zacks.
Business Week Online uses portfolio tracking, screening, and analysis tools provided by Telescan, which also runs the Wall Street City site. The portfolio manager allows users to track 25 portfolios of 150 securities each, as well as track a separate cash balance. Portfolios are updated automatically every two minutes, and free E-mail alerts are triggered by price targets. End-of-day portfolio E-mail updates are also available.
Portfolios can be viewed using eight different displays including analyst ratings, insider trading, and price breakouts. The price breakouts look at short-, intermediate-, and long-term trends versus 30-day moving averages. Performance reports can be calculated for individual securities and single portfolios, with returns for the holding period only. The Business Week Online portfolio tracker is pretty much a standard free tool that has some nice portfolio views not found on most other sites.
Quite possibly the best investment-related Web site for company and market news, CBS MarketWatch provides an on-line portfolio manager to its registered users free of charge.
The CBS MarketWatch site states that the manager can handle an unlimited number of portfolios, but asks users to limit those portfolios to 200 securities per portfolio—consisting of stocks, mutual funds, and options. Portfolio displays are refreshed automatically on a static schedule of every three minutes. CBS MarketWatch offers a diverse set of news services—BusinessWire, CBS MarketWatch, The New York Times, 10K Wizard, Motley Fool, and TheStreet.com.
E-mail alerts can be sent out as they are triggered or combined into a single message sent out at a user-determined time. CBS MarketWatch offers a narrow pop-up window that continually tracks the prices of your portfolio holdings.
Portfolio performance measures are available for the holding periods of securities and single portfolios. Special views—six in all—are available for portraying portfolio asset allocation and insider trading activity. The site also features a nice "adjust position" button next to each security forquick-and-easy accumulation and sell tasks.
The CBS MarketWatch site is known as an on-line market news hub. If you are a fan of the news offerings here, be sure to check out this basic tool and utilize it as part of your analysis.
CNBC on MSN Money
Microsoft and CNBC offer a complete personal finance and investing site through their free Web offering. The investing section provides portfolio tracking, charts, news, educational articles, stock and mutual fund research, and brokerage services. Access to articles, news, screens, company and mutual fund data, and portfolio tracking is free to all Internet users.
The site's portfolio tool is a true module—an actual software program that is downloaded and installed on top of your browser software. Designed using Microsoft's ActiveX technology, this mini-software program, technically termed an applet, is completely menu-driven. It provides users with full report printing capabilities. However, the presentation of the portfolio tool is quite different on a Macintosh machine: Gone is the ActiveX appearance and in its place is a standard html-based page. With the html interface, portfolio creation, editing, and analysis becomes a much slower, step-by-step process.
CNBC on MSN Money's on-line portfolio manager allows you to track one portfolio that can include up to 50 accounts—which are essentially 50 mini-portfolios—tracking up to 5,000 securities total. The portfolio application handles an above-average range of securities, including bonds and options. A cash balance can also be monitored within the manager. Portfolio displays can be refreshed at any time manually or automatically when you are in the module. The frequency of these automatic updates is adjustable to a timeframe selected by the user and can be as short as a minute.
Basic alerts from the site arrive to your MSN Messenger Service, a program installed on your computer and running on your desktop. Delayed alerts arrive in the form of breached price targets, volume levels, and percentage price changes. As part of the setup of these MSN Alerts, users can also receive price quotes twice a day at times established by them. This allows for price quotes to be received at the market close as well as at another point during the trading day. You must have a live Internet connection for the alerts to work. Users can also elect to receive cell phone text message alerts and regular E-mail alerts. Note that to sign-up for alerts to a regular E-mail account, you must agree to share your E-mail address with other participating sites and services.
The site imports data from Microsoft Money and Quicken desktop as well as the Yahoo! Finance Web site. Similar statement importing capabilities are available via a number of linked brokerage firms as well.
The degree of analysis and evaluation proficiency found on CNBC on MSN Money is above average—in fact, it rivals some software applications. This is also true for the on-line tracker's reporting strength and print report options. In addition to several dynamic on-screen portfolio views, this application allows users the ability to print out software-grade portfolio performance reports. All of this is possible because of the ActiveX technology wired throughout this Microsoft on-line tool.
For performance reporting, the portfolio tool can break portfolios down, analyzing them according to security type, asset class, and investment style. It can also report on the combined performance of multiple portfolios. A return calculations view offers eight different performance returns. Another view entitled valuations provides average cost basis, and a positions-by-lots display offers specific-lot cost basis figures.
GainsKeeper's focus is to provide a complete portfolio tracking and tax-evaluation system. GainsKeeper allows you to track all of the transactions in your portfolio and automatically adjusts your cost basis for corporate actions and wash sales, while calculating and characterizing your capital gains for tax reporting purposes.
GainsKeeper provides standard portfolio monitoring that tracks a wide range of securities and transaction types including stocks, mutual funds, options, bonds, cash and user-defined securities. GainsKeeper is able to aggregate data from a range of financial institutions. Data can also be imported from software programs such as Quicken and Excel. It is capable of automatically adjusting the cost basis of a stock for a range of corporate actions—such as stock splits and dividends, mergers, spin offs, liquidations, name changes, reorganizations, and return of capital.
GainsKeeper allows you to examine your asset allocation and provides diversification tools for rebalancing strategies.
Pre-trade analysis helps to reveal the implications of your actions. Advice for year-end tax minimization is provided, along with "sell grades" to identify which lots to sell first.
Reports are customizable and include an IRS Schedule D report that can be imported into tax preparation programs.
GainsKeeper offers various subscription levels, priced by the number of transactions entered into the system. A one-year Investor subscription costs $49 per year and covers 100 transactions. If your trading activity exceeds your service level, additional Trade Buckets can be purchased at any time.
Kiplinger.com combines the editorial content of Kiplinger's Personal Finance magazine with investment research tools from Thomson Finance. Kiplinger.com is a comprehensive investment Web site providing portfolio management, quotes, news, stock and mutual fund data, screening tools, and investment education.
Kiplinger.com's portfolio tracker is transaction-based, it tracks purchase date and price—even when you buy or sell shares of the same security more than once—which comes in handy at tax time and for calculating performance.
The portfolio tracker is set up to automatically refresh every five minutes. You can set your own preference to update data at any interval from five to 60 minutes.
The tracker allows users to create an unlimited number of portfolios with up to 100 securities in each. The tracker handles stocks and mutual funds. Kiplinger.com automatically adjusts the number of shares held and initial transaction price when stock splits occur. The tracker also offers an option for automatic reinvestment of dividends. With this option, additional shares will appear in the transactionhistory for your security each time a dividend is reported. Another nice option is the tracking of recurring investments that are made on the same day each month for the same dollar amount. Recurring investments can be automatically entered on the specified day each month, using that day's closing net asset value.
Portfolio views can be customized by choosing from nearly 50 data elements. Portfolio Analysis tools include an asset allocation tool, which breaks down holdings by asset class and sector; a snapshot of analyst buy and sell recommendations for each holding; and trading activity for each security by company insiders. A desktop scrolling ticker is also available to keep track of the latest prices when you're not logged in to your portfolios.
Morningstar.com is a full-featured investment Web site providing portfolio tracking, market monitoring, stock and fund screening and research, educational articles, and message boards. Much of the site is free, with additional portfolio analysis, research and screening available through the premium service for $12.95 per month.
Morningstar.com has the capability to track 50 portfolios—each holding 50 stocks or mutual funds, 10 bonds, and 10 cash securities. The on-line manager can also keep a cash balance. Portfolios are updated by Morningstar on a delayed basis. After each market close, free daily E-mail updates are available that present the market value of each of your portfolio holdings as well as links to news stories concerning them. Users can also elect to receive E-mail notification of stock and fund news as complex as a heavy volume price movement or as simple as the change of a ticker symbol or fund manager. Premium subscribers can also receive notification of changes to the allocation or makeup of a given portfolio.
Morningstar's on-line portfolio manager works in conjunction with both eligible portfolio management software programs-Microsoft Money and Quicken. It also allows users to import portfolio data entered on AOL, CNBC on MSN Money, Quicken.com and Yahoo! sites.
Morningstar.com offers a solid list of report capabilities. Performance numbers can be compared among individual securities, as well as by asset class and investment style. Performance reports can also be generated for single andmultiple portfolios. Other portfolio interface views include intraday, fundamental, and gain/loss—which employs the specific-lot method for handling cost basis.
Morningstar.com also features a unique fuction for examining your portfolios called an X-Ray. X-Rays are slightly different from standard tracking views in that they can break down your portfolio and present your holdings in different formats. Ten different premium service X-Rays can be displayed, including Asset Allocation, Style Box Diversification, Stock Sector, Stock Type, World Regions, and Fees & Expenses. Another premium X-Ray is the unique Stock Overlap X-Ray, which analyzes the diversification of your portfolios across mutual funds and among individual security holdings.
Morningstar.com's portfolio tools offer useful alerts and helpful portfolio views. Although certain elements are tied to monthly fees, it is still a solid portfolio application.
Quicken.com is in the process of changing from a free, stand-alone investment Web site to an on-line extension of its popular personal finance software program—Quicken. Many proprietary Quicken tools are disappearing and being replaced with investment tools from Yahoo! Finance. Past users of Quicken.com have the option of buying or registering a recent copy of Quicken to continue using the Web site, or migrating their portfolio to Yahoo! Finance.
Registered Quicken.com users gain access to tools such as Quicken's One-Click ScoreCard, a retirement planner, and the stock and mutual fund evaluator. Registered users can track their portfolio on-line and maintain watchlists and on-line alerts, but E mail alerts and the enhanced on-line portfolio tool are no longer available.
Quicken.com's standard on-line portfolio manger tracks 50 portfolios with 100 securities per portfolio. Portfolios can consist of stocks, mutual funds, and bonds. A cash balance can be monitored right next to your securities.
The alerts on Quicken.com consist of icons in the form of exclamation marks, up arrows, and down arrows that appear next to the corresponding tickers. A summary tab of current alerts can also be accessed from a link at the top of the on-line portfolio module. Price targets, volume levels, dividend announcements, and splits trigger these alerts.
Market news sources currently include CBS MarketWatch, Dow Jones, and The New York Times.
This on-line portfolio tool is in the process of a major overall. New users would do well to stay clear until the dust has settled.
The Smart Money magazine Web site supports two free on-line portfolio managers—a standard html-based on-line portfolio manager and an enhanced tracking tool that utilizes Java technology. Like ActiveX-driven applets, the Java-based tool runs on top of your browser software and allows for more dynamic portfolio tracking and analysis. It also offers more options when it comes to printing out portfolios. The look and feel of this Java-enhanced portfolio tracker is the same on a Windows PC as it is on a Macintosh; nothing is lost in the layout's interface either. At the site, registered users can enter up to 50 portfolios and can easily switch back and forth between the two modules so as not to lose any data or double-enter their holdings.
The 50 portfolios can hold a maximum of 100 securities—comprised of any mix of stocks and mutual funds. The portfolios can also track a cash balance. Five years of transactional data can be saved. Portfolios can only be updated automatically by the site on a delayed basis. Real-time updates cost $10.95 per month. Newswire services include Dow Jones, Reuters, and Smart Money magazine.
Portfolio performance can be assessed for individual securities and according to security asset classes. Performance return numbers can be calculated for any time period through an interactive chart.
Another area where this site has traditionally stood out from the crowd, and continues to do so today, is with regard to analysis measures. Within both the portfolio interfaces, there are several Java-enabled functions designed to graphically analyze the performance of your portfolios. One such function is a return meter that graphically displays the top-performing stocks and mutual funds within your portfolios. SmartMoney.com has many unique features in several areas of analysis, and portfolio tracking is no different. The tracking is decent, but it's worth your while to set up a portfolio here if only to utilize these extra analysis functions.
Yahoo! Finance, the popular site for market and economic news and statistics, offers completely free portfolio tracking capabilities to all registered users.
Yahoo! Finance portfolio tracker is a typical portfolio tracker in that it presents information through a series of customizable spreadsheet-like displays. Portfolios can consist of stocks and mutual funds; users can include a cash balance with their portfolios. Users can create portfolio displays that list up to 16 columns of data chosen from a group of 50-plus data elements that focus on trading information, company fundamentals, earnings estimates and basic technical factors.
Each view provides links to more information for each of the securities in your portfolios. Links include charts, quotes, news, SEC filings, profiles, research reports, insider trading data, options data, and Yahoo! Finance message board posts.
The Yahoo! Finance site includes a reminder feature that acts as an alert, minus the E-mail element. These reminders focus on price limits. Once a price limit is reached, an up or down arrow-like caret will appear for that security within the column labeled "Last Trade." Seven newswire services are offered through the Yahoo! Finance site and include CBS MarketWatch, Motley Fool, Reuters, and TheStreet.com.
Portfolio data can be exported to most spreadsheet programs via a special Download Spreadsheet Format link.
Performance reports for single portfolios as well as individual securities can be analyzed for their holding periods only.
Yahoo! Finance is not the slickest on-line portfolio manager around, but it does cover all the basics for keeping up to date on your stock and mutual fund holdings.