Disclosure: IBD provided ValueWalk a free subscription to MarketSmith for this review.
Investor’s Business Daily offers a full suite of premium tools that go a long way toward helping investors pick their own stocks. MarketSmith is one of the premium products offered by IBD, and it packs a lot of information and analysis into one powerful subscription. One way IBD markets this product as helping investors interpret the market, and I think that’s certainly an accurate assessment. I would add that MarketSmith does this through powerful stock charts that are packed so full of information that you’ll miss a lot if you don’t pay attention while you’re using it.
How MarketSmith works
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If you like spending a lot of time studying stock charts or are trying to learn more about the technical side of trading stocks, then a MarketSmith subscription will likely be a good investment. The entire product is centered around stock charts, but these charts are so much more than the charts you see in most places.
Upon logging into MarketSmith, you’ll see a list of the four main categories: “Up on volume,” “Down on volume,” “Breaking out today,” and “Near pivot.” Clicking on any of them opens up the main MarketSmith charts and a list of all the stocks that are in that particular category. If you drag the list from the bottom up, you can see more of the stocks that are in that category, and clicking on any of the stocks brings up its chart.
The chart tells you many bits of useful information, including not only the stock price but also its pivot week, the chart pattern that’s appearing on the stock chart, and other key data points. It’s easy to click on any of the stocks on that list that interest you. I like how MarketSmith groups multiple stocks in each of these categories because if you were already looking at a particular stock because you noticed a particular chart pattern, you can easily find other stocks that are breaking out in a similar manner if it’s on one of the MarketSmith lists.
Information overload… but it’s a good thing
If there is one problem with MarketSmith, it’s information overload. However, if you really take time to learn how to use the platform, you can really learn a lot, not only about reading stock charts and interpreting chart patterns, but also about tracking trends as well.
The folks at MarketSmith seem to understand the way their product offers information overload, so they’ve put together several webinars and videos to help you learn how to make the most of the platform. I definitely recommend them because if you don’t invest time into learning the platform, you will miss out on a lot. When you spend money on something like MarketSmith, you definitely want to make sure that you maximize what you get out of it so that you get more value for your money.
Checking stock ideas on MarketSmith
One of the plethora of features you will find in MarketSmith is the “Stock Ideas” button at the top of the chart section. Clicking on it brings up a pop-up with several categories, and the thing I like most about it is that if you have a particular feature or category you are looking for, this button makes it easy to find multiple stocks that all fit in it.
For example, if you wanted to look at growth stocks, it’s easy to select “fastest growing companies” as your choice, and MarketSmith will bring up a list of the 150 fastest growing companies. Double-clicking on any of the stocks on the list will bring up its stock chart, and then the fun really begins.
It’s important to realize that there is so much more than meets the eye when it comes to the stock charts in MarketSmith. Clicking anywhere on the chart brings up precise details on where the stock was trading at any particular day or minute, depending on which view you choose. The chart also plots the S&P 500 for comparison and the stock’s relative strength rating.
There’s also another important feature on the MarketSmith charts that’s easy to miss, but advanced users and chart technicians will probably love it. If you look to the upper right-hand corner of the stock chart, you’ll see a number of icons, including a printer icon to print it and others.
Don’t miss the pop-out charts
The button that looks like a square with four smaller squares inside it pops out the stock chart of the one you’re looking at, and then you can add additional stocks to the chart to run a comparison. Advanced users will appreciate being able to compare the action on the stocks of companies in similar growth or momentum phases. This pop-out chart also allows you to draw on it, so you can plot your own trend lines as you compare multiple stocks with similar characteristics.
There is also a button to pop the chart out so that you can pull multiple MarketSmith charts up separately (rather than on the same one) and compare them all at the same time. If you’re looking at the trading action on multiple stocks, this is a very useful tool as well.
Advanced users in particular will appreciate these two tools to pop the stock charts out of MarketSmith. Novice chart users may get less out of this feature because you really have to know what you’re doing when it comes to marking up stock charts.
The more I use MarketSmith, the more features I find, so you could probably spend as much time as you want studying charts and researching the stocks that interest you. MarketSmith also offers live alerts at the top of the charts, so you can always see which stocks are breaking out or have triggered another alert. This could be very helpful for day traders or even swing traders who aim to check on their trades at one or two specific times per day. These alerts are clearly designed to make it easy for traders to take action based on breaking information from the stock charts.
Check out MarketSmith right here
IBD has some other interesting products