Evaluating Information Sources
Not all investment information is equal. Sorting sources by reliability and by the incentive behind them is a basic research skill.
Why this matters for beginners
Beginners are exposed mostly to the least reliable sources, because promotional content is the most widely distributed.
Main explanation
Primary sources come first: annual reports, filings, transcripts and regulatory disclosures. They are checkable and legally constrained.
Secondary sources such as reputable financial press are useful for context but compress and interpret. Verify any figure that matters.
Promotional content is the weakest category: anonymous posts, paid newsletters and social media accounts holding undisclosed positions.
Ask what the author gains. A writer who benefits from your purchase is presenting an argument, not an analysis.
Example using a real company
A claim about a company's margins should be traced to the report itself rather than trusted from a summary post.
- →Strong: the figure taken directly from the annual report.
- →Weak: a screenshot with no source and an anonymous author.
Common beginner mistakes
- ✕Trusting confident tone over verifiable sources.
- ✕Never checking a figure against the original filing.
- ✕Ignoring the incentives of the person publishing.
Key terms
- Primary source
- The original document produced by the company or regulator.
- Secondary source
- Reporting or commentary based on primary documents.
- Conflict of interest
- A benefit that may bias the information presented.
Key takeaways
- 01Primary sources outrank commentary.
- 02Verify any figure that affects a decision.
- 03Always ask what the author gains.
Check yourself
- 01Annual reports and filings are primary sources.
- 02A confident tone is a reliable indicator of accuracy.
- 03Checking the incentives of a source is part of research.
Try the concept on a real company
Take one claim from an Analyzer summary and confirm it against the company's own published report.
Educational examples only. Not buy or sell recommendations.