That’s partly the point - other brokers do it and have done it in the past. Freetrade isn’t trying to emulate others, it’s trying to do something new and improved. This just doesn’t gel with that ethos.
Can you explain how/why? Surely providing information in an accessible way is exactly that ethos.
This isn’t explicit enough for you?
Freetrade does not provide investment advice and individual investors should make their own decisions or seek independent advice. The value of investments can go up as well as down and you may receive back less than your original investment. Tax laws are subject to change and may vary in how they apply depending on the circumstances.
I don’t think it matters how explicit the disclaimers are. I’m sure HL also have equivalent disclaimers for their wealth 50 list and other published articles etc.
The purpose of brokers publishing market news and research has always been to encourage trading, because that’s how they make money.
But trading is deleterious to the returns of long term investors.
Freetrade have a different ethos. Free trades mean they can align with the best interests of long term investors. Which means they don’t need to use the underhanded tactics of old. Which means stock takes don’t really have a place here, as interesting as they might be.
Thanks for explaining my position on this perfectly.
Why are you assigning meaning to what Freetrade does? Let me apply your argument to something more extreme and see how it holds up:
The purpose of brokers existing and offering the ability to trade is to encourage trading, because that’s how they make money.
But trading is deleterious to the returns of long term investors.
So, by that logic, Freetrade shouldn’t exist. It’s the exact same logic.
Just because other firms publish market news to encourage trading, doesn’t mean that Freetrade does it for that reason.
They might say it’s not investing advice but the rest of the blurb is designed to show how these are specially selected market bearing funds etc.
There’s a huge difference between what they do and what Freetrade do. I doubt anyone reading Barr’s would see that as anything other than a balanced analysis
Long term investors still need to select stocks to invest in in the first place. I hardly see how an article discussing the history of a business is encouraging any sort of deleterious behaviour. An extension of your argument would be to list nothing on Freetrade except global ETFs since stock picking will generally post lower returns than buying the whole market.
I don’t think the intent matters. Freetrade should take responsibility for the effect. If there could be a deleterious effect, and they don’t have any counterbalancing significantly positive reason for doing something, then why do it?
As far as I know, the stock takes are “just for fun”. They could be on the author’s personal blog where the interested can enjoy them, but the uneducated won’t be harmed by them.
I of course meant to imply that excess or unnecessary trading caused by chasing returns by investing in the latest company your broker talks about, is bad.
Freetrade should exist because the public needs a broker that has no financial interest in getting them to trade as much as possible.
Freetrade should exist for the long term investors who just want to follow a buy and hold strategy, maybe doing a buy every month of the same thing(s) as last month.
It’s great that Freetrade exists. They should play to their USP and strengths. They don’t have to emulate HL or the others.
Really? That’s an incredibly elitist statement
The mere existence of an article discussing the pros and cons and history and possibilities of a particular company, will make someone want to buy stock in that company. A series of such articles will make someone want to base (or factor in) their buy choices on what Freetrade talks about.
Long term investors do need to select stocks in the first place. But they shouldn’t be doing so on the basis of stock broker articles. The problem is, stock picking is an incredibly difficult art that 99.9% of people won’t do well at. Any short cut available to them will be taken.
The most common short cut is “I like the company, and it’s doing well in the stock market”, which is of course one of the worst ways you can pick a company to invest in. Seriously, I’ve little doubt that this is how the majority of retail investors pick their stocks. Many members of this community use this method.
And reading an article about a company written by the broker that you love and feel loyalty toward, has a good chance of making you like that company.
I don’t see anything wrong with my statement. In my opinion, those who know about the stock market have a social duty and responsibility to help those who don’t know about the stock market avoid making mistakes.
I think Freetrade believes the same, hence their valuable articles aimed at new investors on their blog.
But not every new investor reads those, so Freetrade should avoid harming such people, especially where the cost to do so is £0.
I certainly agree that the articles have the chance of influencing the community, especially as many of the people using Freetrade are investors in Freetrade itself so are likely to have bias towards the business in excess of what people might have had in the past for traditional brokers. This is definitely something Freetrade should be aware of. With crowdfunding comes a lot of blind loyalty…
I do understand where you’re coming from, I suppose I just believe that Freetrade as a business should be looking to offer as much to its customers as possible. Freetrade is not a workplace pension or other low risk scheme, it is a platform for trading stocks. If they are going to offer individual stocks, which as we know are not necassirily the best investment over large ETFs, then they are already ‘encouraging’ people to buy them. As that is the case I can’t see the harm in articles about individual stocks. If people are not going to do their own research then they will buy on a whim regardless.
What benefit, exactly, do you think Stock Take articles provide to Freetrade customers?
You can’t see any harm in them (and we’ll agree to disagree on that point), but what’s the upside?
What does a Freetrade customer miss out on by not reading a Stock Take article?
The only thing I can think of is “a fun read”. If that’s an important feature of a stock broker that Freetrade should provide, they’d be better off posting “joke of the week” or something
I personally enjoyed the articles because in a compact way explain how a certain company operates and some insights on the sector that I might have overlooked or had no interest into and some interesting extra information on some companies I was interested into.
In particular since I don’t follow football I would have probably never even checked if the teams were publicly available and even less idea on how they operate if I didn’t read the article done about them.
Also the take on Fever Tree was a company that I even didn’t know it existed till not long ago.
Games Workshop is a company that I was following and some bits of information I didn’t know about.
So yes might inspire some people to look more into it but for how they are written I think are well balanced, give an intro and somehow a guideline on how conduct your research at least as starting point.
I read a number of articles from Fools and other random from Google search and most of them are written to make you feel pumped or depressed about a stock, sector etc. while I didn’t get the same vibe from Freetrade articles, more a Wikipedia kind let’s say.
This is my take.
For full disclosure I didn’t invest in any of them even if I regret not having pulled the trigger on GW as soon as I got my account open in April. But we live and learn
The articles are informative, as well as providing me with an insight into methods of evaluating a company. They also point me off into my own research.
I don’t think it’s an important feature, I just don’t agree that their is a major downside.
Keep up the good work Freetrade! I think the majority of people in the community appreciate the extra information provided in your articles. I certainly don’t read the articles as ‘advice’ just clear presentation of facts.
Thanks! This is certainly what we are working to achieve with the Stock Takes and Weekend Reads, and we know it works (although we also see a lot of areas for improvement!). We receive a LOT of replies, and they are almost always uniformly saying ‘this is super interesting, thanks.’ My favourite message was along the lines of ‘I’ve just opened this email to unsubscribe, but it’s so interesting, I’ll stay on!’
The vision is exactly this - to switch you on to how exciting companies, index trackers, markets are and to encourage you to start doing your own research. A lot of lip service is paid to education, and we think creating content so interesting that we ourselves would want to consume as the right approach to make progress on it. There is nothing like it out in the market right now. To me, this sounds accurate:
I struggle to follow some community members’ logic above though. The goal of this content isn’t to recommend particular companies, and if it was, I’m confused as to how they think we achieve that, as we give a balanced account and don’t take a view. Balance is key, and even beyond the individual stories, we pick the set of stories in a way that they’re balanced. We covered tech startups as much as seemingly tired old companies as well as an index tracker.
No correlation between people buying stocks and these posts exists.
I agree that ‘there’s nothing like it out in the market right now’. I think Toby’s writeups in particular are amazing and underrated. Free, well written, entertaining and highly informative content for the readers and brand enhancing for your company.
I totally agree and I have to say that the quality of the articles started great and continues to improve.
The only thing extra that might interest some people is a bibliography.
About why some member perceive them as recommendation I’m not sure, but my best guess is because a company or a sector was placed in the spotlight.
Thanks for making them and keep up the good work because are great reads!