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Why I added FinChat to my Equity Research Process

Since November 2024, I’ve been hooked on FinChat’s fundamental charting product. At first, I was most focused on finding the best copilot tool to improve my investment research process. Last year, my biggest problem was gathering critical information in a timely manner, but not anymore. Since I started using FinChat, I've been filtering for 30-40 new ideas, comparing competitors, and analyzing segment key performance indicators in great detail. These challenges are most common during earnings season.

Comparing Signal vs Noise with Fewer Data Points

When I started in finance, reading the Wall Street Journal was the most common way to learn about the markets. The most generic advice for professionals was to read the headlines. Which is great if you’re getting started in the industry, not so great if you want to learn how to beat the market.

You see, the media and headline news are designed to deliver noise to sell more ads. First, the writers are not investors and their incentive doesn’t structure with your investment motives. So early on, I found terminals like Bloomberg that made money selling data instead of selling the news. Even if you watch Bloomberg Television today, you will find most of their content has raw data from Bloomberg terminals. I liked this model a lot and found it more helpful than the WSJ when I started investing.

As a fundamental investor, the biggest problem I found early on was portfolio attribution when managing investments. If you invest in 5-6 core positions, you need to know how specific factors will impact individual investment. For example, if there is a semiconductor supply chain problem in China, then that creates a buy or sell signal for different semiconductor stocks. Of course, you can read the news about these supply chain issues, or you can use two of FinChat’s core products to do your own research: Charting & Copilot.

Building Custom Metric Charts with FinChat

Charting is popular in two areas of finance: fundamental and technical analysis.

Now technical analysis is straightforward. Most websites have some charting tool. But what websites don’t have are great fundamental analysis tools. FinChat is the first investment research tool where I could create custom charts based on fundamental data. Ycharts might have the most similar solution but it is designed for enterprises and asset managers. Ycharts is good but FinChat is better for experienced retail investors. Plus if you publish content online, FinChat’s custom metric tools are a goldmine.

FinChat’s charting feature provides a deep dive into each financial line item and segment KPIs (key performance indicators). I use both features quite frequently. Let’s begin with segment KPIs.

You see, every company and industry has its own set of key metrics. If you only looked at reported financials, all top-line revenue numbers would look the same. But if you are an operator or work in the industry, then you would be familiar with the industry landscape.

For example, Nvidia targets a very different customer base than Intel, yet they both specialize in semiconductors. Personally I’ve known Nvidia as a graphics card company because they specialized in the gaming industry. But years ago the team decided to double down on A.I. and made data centers a significant part of their core business. And in a few short years, data center revenue 10x’d their gaming revenue.

The beauty with FinChat’s custom charting tool is you can break out and highlight specific segments. It is also a fantastic way to track correlations between the stock price, competitor financials and other key metrics. Personally I use it a lot to track segment KPIs for specific companies. I don’t have time to read every single earnings or industry report, so FinChat saves me 5-10 hours of research when looking for new ideas.

Copiloting financial data

Done right, copilot for new investments will be integrated into every stock brokerage platform in the world. Right now, retail investors might use copilot for simple questions like, “What’s the stock price of Microsoft today?” But savvy investors will use copilot for deeper dives into specific ideas.

Below I am looking at the investor presentation for ServiceNow. Typically this would require me to visit the ServiceNow website and look through their Investor Relations section. But I’m able to do everything through FinChat’s web app portal.

Pulling up investor presentations or earnings reports is a time-consuming process. The SEC EDGAR provides raw files but it is unhelpful if you want to find investor presentations. FinChat’s partnership solves this problem with its Quartr integration.

Investor presentations are a newer phenomenon in the capital markets. If you have read Warren Buffett’s shareholder letters since the 1950s, you will notice the original delivery method was always long-form written copy. It was very boring to read. But that has changed as Investor Relations at every major public company wants to improve communication with shareholders. And I think fintechs like FinChat and Quartr are capitalizing on this trend.

FinChat’s particular advantage here is that they have the best copilot for retail investors. I’ve used several other similar tools but FinChat is the only product that displays the latest earnings, financial data and investor presentations in one place. In a few minutes, I find all of the relative data points to help me make a better investment decision.

FinChat is the new fintech operating system for retail

I’ve used countless financial research and software tools. Each one has a different success metric when it comes to servicing clients.

For example, some products focus on investment research, others focus on investment data. It all depends on who your ideal customer base is. Retail investors tend to use trading tools to make short-term decisions. Financial advisors use institutional products focused on managing and servicing clients.

The biggest pain points when it comes to investing are related to investment accuracy. The time between when you make an investment and exit an investment, determine your rate of return. That’s why I embedded FinChat into my investment workflow to speed up my research analysis. It is one of several tools I use to increase the accuracy of my investment process.