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With TipRanks, Investors Can Optimize Their Portfolios by Leveraging Insights from 15,000 Experts Through an Easy-to-Use Dashboard

With TipRanks, Investors Can Optimize Their Portfolios by Leveraging Insights from 15,000 Experts Through an Easy-to-Use Dashboard

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Matt Walker
By: Matt Walker
Posted: May 16, 2019

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In a Nutshell: Retail investors can have difficulty determining which analyst recommendations and portfolio strategies are the most trustworthy. TipRanks helps to solve this problem by providing ratings for sell-side analysts, bloggers, news outlets, and more. The company employs machine learning technology to scan thousands of articles and websites to determine the veracity and reliability of stock advice. This information is presented via a variety of data sets on the TipRanks website. And, through its Smart Portfolio features, investors can compare their portfolios to those of 400,000 other TipRanks users, including the portfolios generating the highest returns.

The average investor today faces a never-ending stream of advice from news outlets and experts on which assets are hot, which ones are not, and which investment strategies they should adopt.

With so much information available, investors can quickly become overwhelmed, or worse, unknowingly follow investment advice from someone with a poor track record.

TipRanks was founded with the mission to bring the most accurate and accountable financial advice to the general public.

“In the capital markets, retail investors face a lot of challenges,” said Oz Talmor, Business Development Manager at TipRanks. “They have had trouble outperforming markets in recent years.”

Talmor said that around 2012, the TipRanks Co-Founders, Uri Gruenbaum and Gilad Gat, took note of the huge industry of sell-side analysts in the market. The analysts often worked for some of the biggest names in finance, and they were quoted in press releases or found on various news outlets doling out advice on which assets to buy or sell, and when.

TipRanks Logo

He said investors tend to follow the advice of these analysts because of their appealing rhetoric and the fact that they were often tied to leading banking brands.

“The only problem is that there was no transparency,” Talmor said. “We don’t know which analyst is worth listening to in the end. They all have a big bank behind them. How do we, as retail investors, distinguish which ones are giving quality advice?”

As an experiment, Gruenbaum researched the track record of a popular analyst and found that his recommendations were often very bad. Talmor said the discovery naturally led to the question of how many more so-called experts were sending out bad investment advice to consumers.

That’s when TipRanks was born. Originally, the program was simply a browser extension that allowed users to hover their cursor over an analyst’s name in a story and see how successful the analyst had been with his or her previous predictions.

Today, TipRanks is an expansive website that offers a range of ways to explore the accountability of analysts and gain exposure to the very best financial advice.

Scanning Hundreds of News and Online Sources to Identify the Most Effective Stock Analysts

“Currently, what we have is a big research platform that has branched out into more data sets that scan and rank the advice of financial analysts,” Talmor said.

The company calls its platform a financial accountability engine, powered by machine learning and specialized algorithms. Users can see the track record of any stock analyst, blogger, hedge fund, or corporate insider going back as far as January 2009.

Oz Talmor

Oz Talmor is the Business Development Manager at TipRanks in Tel Aviv.

Talmor explained that TipRanks gets its large volume of data through its programs, which are constantly scanning news websites, such as CNBC, CNN Money, Fox Business, The Motley Fool, Seeking Alpha, and many others. The programs are able to deconstruct the HTML code and determine who the analyst is, what firm he or she works for, how long the firm has been around, whether the information is new or old, and numerous other factors.

TipRanks also analyzes online bloggers and other writers who dive into more speculative territory based on their opinions, Talmor said. This requires a more sophisticated machine learning program that can identify sarcasm and other less straightforward language.

“At the end of the day, we’re always figuring out how to take big, complex data and serve it to beginning investors and make it as simple and intuitive as possible,” Talmor said. “We get lots of positive feedback from new investors on how we helped change their investment strategies and how they find it so valuable because they were getting overwhelmed on their own.”

He said TipRanks currently has more than 500,000 visitors each month to its website. The company also works with brokerages and banks by providing a white label version of the platform to their audiences.

Overall, more than 10 million investors are using the TipRanks platform, Talmor said, and the company continues to grow quarter over quarter.

Multiple Data Sets Provide Investors with Rich, Diverse, and Timely Information

Talmor said TipRanks presents its information to users through a number of different data sets.

“The most common data set that investors come to see is the analyst ratings,” he said. “People are also interested in seeing the blogger recommendations since we started scanning those pieces as well. It’s a more sophisticated type of article to scan but it’s a very interesting place to read opinions.”

TipRanks users can also click on links in the analyst and blogger ratings to go directly to the articles from the recommenders.

TipRanks Machine Learning Graphic

TipRanks uses machine learning tools to analyze data from a wide number of sources to provide investment insights to its users.

The company more recently began analyzing the SEC website as well, Talmor said. Many businesses are required to make certain disclosures, including insider transactions, which may be of interest to investors. These disclosures can be found on the SEC website.

“If you’re a corporate insider and buy or sell stocks in your own company, you have to report that information within 48 hours,” Talmor said. “These disclosures are usually presented through very boring forms that are hard to read for any human. We train our machines to quickly analyze the forms and pull out the relevant information.”

TipRanks also analyzes quarterly SEC Form 13F filings that can reveal how hedge fund portfolios change over time.

The platform also provides a news sentiment analysis that Talmor said is a very critical data set for investors these days.

“We analyze 120 news websites and can tell if an article is talking about one, two, or three companies, and we can see the article’s focus to determine what the sentiment is of the company the article is covering,” he said.

Talmor said this is valuable to investors because they can gain insight into how a particular news outlet is portraying certain companies and see if it aligns with their own assessments.

TipRanks also offers a data set that analyzes investor sentiment, he said.

Finally, the company offers a Smart Score based on eight data sets to bring users a quick way to gain valuable equity insights. Stocks with a score of 10 are considered to offer the best investing opportunities.

TipRanks’ Smart Portfolio Allows Clients to Connect to Data from 400,000 Other Investors

In addition to analyst ratings and rich data sets, TipRanks offers its Smart Portfolio as a way for investors to instantly compare their own portfolios to 400,000 others.

“You kind of have all of Wall Street working for you to get feedback on your portfolio,” Talmor said. “You can see how much successful investors have allocated to specific companies, which helps you understand how much you should allocate in your own portfolio.”

The Smart Portfolio tool also allows users to filter through portfolios in a number of ways, such as seeing what investors under 35 or investors over 55 are investing in. Users can also compare their portfolios to the top 10% of other TipRanks portfolios to help them generate the highest return with the lowest risk.

The company launched the Smart Portfolio mobile app in 2018.

“This innovative stock tracker app brings TipRanks’ comprehensive data capabilities and powerful Natural Language Processing (NLP) algorithms into one simple platform,” according to a press release. “Now users can access key data points, find fresh investment ideas backed by top analysts — and actively track their portfolios — all within an intuitive user experience that can be accessed anytime, anywhere.”

The app features three main components. The My Performance tool, like the desktop version of the Smart Portfolio, compares the user’s portfolio with those of other TipRanks users. The Portfolio Tracker allows users to monitor and track all their stocks in one place. And the Investment Ideas page offers exclusive insights based on the activity of financial experts.

QuantRanks Will Facilitate Quantitative Investment Strategies from a User’s Laptop

TipRanks is continually evaluating its products and looking for ways to bring more value to investors, Talmor said. And the latest addition to its suite of investor tools is the QuantRanks program, which is currently in beta testing.

Talmor explained that QuantRanks is a valuable asset for users who have more than a basic understanding of the market but don’t have a background in coding or quantitative investment strategies.

“QuantRanks gives any investor the power of quantitative investing that is used by many hedge funds to generate quantitative investment strategies,” he said. “It’s ideal for someone who has been investing for a couple of years and is looking for new ways to move up in the market.”