Any financial educator will tell you about the importance of the informed investor. Investors need to understand the different characteristics of their stocks and bonds, as well as the companies that issue them. One thing that seems to be neglected, however, is where to get the data to do your research. After all, what good is it to understand how to evaluate a company's earnings if we can't find out what the company's earnings actually are?

Corporate Filings
Probably the most useful sources of information, corporate filings provide investors with information detailing companies' financial health, future prospects and past performance. This is the kind of information you need to judge whether certain stocks, bonds or mutual funds are smart investments. For mutual funds, these filings will tell you the fund's level of returns for the past quarter, the fund's expense fees and its portfolio holdings. For the companies that you need to research when buying stocks and bonds, these filings go through the company's balance sheet, detailing financial health and future outlook.

Careful analysis will help you see how and where the company is spending most of its money, how efficient its management is in creating profits and how positive the company's future outlook is. Although many of these reports aren't the most interesting to read, and are sometimes difficult to understand, they do offer a wealth of information that all different investors can use. (For information on analyzing companies, see the Fundamental Analysis and Ratio Analysis tutorials.)

Note that according to SEC regulations, a company that has more than $10 million dollars in assets and 500 shareholders or is listed on an American exchange such as the Nasdaq and NYSE must file official documents for public viewing. These regulations, however, do not apply to all companies, so the smaller the company, the more difficult it will be to track down good information about it. Some small companies chose to fill out the filings required of larger companies, but others do not.

EDGAR
An acronym for the Electronic Data Gathering, Analysis and Retrieval system, this service automatically collects and forwards regulatory filings submitted by different companies. The most important regulatory filing the SEC requires of listed companies is the annual 10-K form, which outlines the company's performance for the past year. The 10-k must adhere to SEC standards, and it is typically more comprehensive then the company's annual report. For mutual funds, EDGAR also provides all prospectuses online, so you can find the specific holdings of the fund's portfolio, the maximum expense ratio that the fund can charge, and even the kind of compensation the fund management receives. (Learn more in SEC Filings: Forms You Need To Know.)

The SEC provides free access to EDGAR at http://www.sec.gov/edgar.shtml, but unfortunately EDGAR is not user-friendly. It's difficult to find information, and when you do it's in plain text format. The info is all there, but you really have to dig to get anything of value. Fortunately, there are other sites that provide a better way of accessing EDGAR data, but the downside is that they typically charge a subscription.

Direct from the Company
Any company that doesn't have a website nowadays likely isn't worth your time. Even most of the stodgiest "old-economy" companies have websites if for no other reason than to provide information about themselves. When at the company's website look for an "investor relations" link. There you'll often find a downloadable annual report, financial statements, stock info, company news, etc.

Every year, companies must send out annual reports to each shareholder, regardless of whether he or she owns one share or 10,000 shares. If you are not a shareholder and you'd rather read the reports in hard copy form, you can typically order them for free directly from the company. Larger companies like to use these reports as marketing tools. Some third-party companies also make a business out of providing free annual reports of public companies. (To learn more about analyzing a company's numbers, check out Fundamental Analysis For Traders.)

Research Reports
If you don't have the time to do all the research by yourself, or you aren't a fan of crunching numbers, you can purchase reports from different firms. Depending on who they write these reports for, analysts are either independent, buy-side or sell-side, and they offer investors a professional examination of a company's current condition and future outlook. Some of these reports are provided at no cost, but most are typically in the range of $5 to $50. You can buy these reports from any brokerage, from many banks, and through financial web sites such as Yahoo! Finance.

Websites
Many different websites will offer information to investors for free, on a pay-per-use basis or on a subscription basis. The advantage of visiting financial websites instead of looking at filings to the SEC is that info is offered in a concise manner. You don't have to sift through the legalese and market copy that companies put into their annual reports. (Read more about analysts in What To Know About Financial Analysts.)

Conclusion
No matter what you are deciding to investing in, it's crucial that you do the right amount of research so you know exactly where you're putting your money. With such a wealth of information available, whether free or not, there's really no reason for an investor to make an uninformed decision.

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