As an investor, it would do you a lot of good to seek professional help before putting your money anywhere. In your search for that help, you may have come across Morningstar or Zack subscription services. Well, that's understandable because they are among the most popular investment advisory services in the market.
However, before subscribing to one, you would want to know if you will be getting your money's worth. Wouldn't it be great then to get a comparison of the two? Well, guess what, that is precisely what we are about to do! Come along.
Overall Rating: 4.6/5
Overall Rating: 4.3/5
About Zacks Premium
First, you would want to know what these companies are about. Zacks was founded in 1978 by Len Zacks and offers investment-related research. By subscribing to the company's services, you get professional research analysis so that you can make informed investment choices.
Zacks is known for its earnings per share approximations but it does offer other similar products ranging from stock data to fund recommendation summaries and supplementary investment tools. The service is therefore ideal for individual and professional investors alike.
The platform also has a math-based stock-rating system that is not influenced by any third party making it a trusted stock-picking service.
Here, we will talk about the pros of each platform. Now, as far as Zacks, here is what to expect.
Both platforms do come with cons and that is to be expected otherwise it will all be too good to be true. Here are some of the drawbacks that come with Zacks.
Morningstar was launched in 1984 by Joe Mansueto who is an American entrepreneur. The company specializes in investment research and essentially rates mutual funds and ETFs. It may also interest you to know that most prominent brokers rely on the platform's services.
Other than rating ETFs, Morningstar also offers credit and stock rating services among other related services for both professional and individual traders. On the platform, you get to access an assortment of reports, funds, bonds, investment tools, and more.
Morning star and Zacks Comparison
Now that you know what you are looking at, how about we compare the two services?
As far as investing, what you want most before committing your funds anywhere, you want expert advice and analysis. Both Morningstar and Zacks provide that so you would want to know how they do it.
When it comes to Zacks Investment…
The main goal is to provide you with independent research that is supposed to give you a trading advantage. The company is run by a team through quantitative analysis. Essentially, the platform helps you figure out which among the numerous mutual funds are likely to do well based on the market scenario presently.
Zacks uses two ranking systems with one focusing on stock-based funds in the US and the other on all additional funds.
As far as Morningstar’s investing advice…
If you are looking for independent financial research advice, you will certainly get it through Morningstar. The company boasts over 5,000 employees spread across the world.
The company uses the star rating method to qualify stocks. The initial ten percent of this category's funds are rated five while the last 10% have a rating of one. The ratings are done three ways with some being done every ten, five, or three years.
You also get to access analyst ratings including neutral, bronze, silver, and gold with gold being the best option.
How they Work
Let us not get into how both platforms work.
Zacks is a subscription service that gives you access to its newsletter that contains rankings, reports, and recommendations. As a subscriber, you can use some of the tools on the platform such as My Portfolio Tracker to evaluate your portfolio and check ranking for each stock.
Once you subscribe to the service, you get daily updates and breaking news regarding stocks and security rankings. This will help you decide whether to sell or buy. You will realize that Len doesn't hesitate to recommend a sale as long as his quantitative techniques justify it.
You will also be advised on whether to hold stocks for the long term or short term. According to some expert research analysts, Len ranks stocks highly only if they have the potential to bring attractive returns.
According to Zacks, his platform functions bests and allows subscribers an advantage because his team considers both fundamental and technical analysis.
One of the first things you probably want to know about Morningstar is that it offers free content. However, with its premium subscription, you get access to comprehensive research over a list of good investments and 600,000 streamlined into convenient categories.
The platform has a best investments page that contains a list of the best ETFs, mutual funds, and stocks. With this service, you can easily pick the best investments individually. The extensive fund and stock portfolio along with tons of expert ratings, analysis, and data make it easy to select great picks independently.
Now, if you are unsure about paying for a premium subscription on this platform, you will be pleased to learn that it comes with a 2-week trial period. That makes it risk-free. Anyway, the platform is easy to navigate and packed with tools that the average investor will find hard to exhaust, which is a good thing.
So, what is similar about Morningstar and Zacks?
First, both services offer premium subscription services for a price.
You also get a risk-free trial period with both platforms. Morning star offers 14 days while Zacks offers 30 days.
Both platforms offer free investment resources. That means you are not required to pay anything to get an idea of what you will get once you pay for a subscription service. This is because the services feature resource centers that give you a glimpse of what to expect.
Morningstar, Inc and Zacks Investment Research also differ in several ways. Let's get into that, shall we?
Zack's ratings are better suited for stocks since they are based on growing earnings. On the other hand, Morningstar's ratings are ideal for ETFs and mutual funds. It also focuses on risky returns.
As far as the kind of investor targeted, Zacks focuses on professional and skilled investors and short-term traders. Morningstar targets all kinds of investors whether skilled or unskilled, long-term or short-term.
When it comes to the layout and investment research, both Morningstar and Zacks offer paid and free services but present the information differently. For instance, Zacks displays a lot on the quote page when assessing mutual funds. With Morningstar, you have to click on several tabs to locate what you are looking for.
Of course, both platforms are priced differently, so here's what you should expect.
Morningstar comes with four major pricing plans. You can choose to pay a monthly fee of $29.95for a basic premium membership or $199 annually. However, you will get the best value with the two and three-year bundles that go for $349 and $449, respectively which translates to a discount of 50% and 60% discount, respectively.
We would advise you to utilize the trial period before paying for membership although you will be required to add a card to use the trial period.
When it comes to Zacks pricing, we have to let you know that its plans are quite costly. The platform's newsletter will cost you $249 annually. However, it does come with a trial period that we recommend trying before committing to the annual subscription.
Who is Zacks for?
Now that you know the similarities and differences between Zacks and Morningstar, we feel that it would be best to let you know who each of the platforms is best suited for.
Zacks is simply designed for the advanced or seasoned investor who is interested in short-term gains and who wouldn't mind a financial assessment. Zacks picks stocks by forecasting earnings and consequently offers reliable buy-sell recommendations.
What we are trying to say here is that you need to be well versed with the investment market to make the most out of Zacks. It is also worth mentioning that the service appeals to skilled investors because it can be used to gather portfolios using rankings, reviews, and recommendations.
Zack does cover an array of investments including mutual funds and EFTs. Subscribers get weekly notifications and daily portfolio updates among other services.
Who Is Morningstar for?
Essentially, Morningstar is designed for investors with an interest in Exchange-Traded Funds (EFTs) and mutual funds because it provides general market information. The platform supports stocks as well as rates funds. That means that advanced investors can utilize the service to source data for supporting a single investment thesis.
This is not to say that the platform will not be useful for investors who want to understand the basics of each investment. Morningstar started analyzing mutual funds officially in the 80s and sticks were only included a few years ago.
Since it has features such as a rating system, the platform is ideal for accelerating its fundamental research. Therefore, if you are not too keen on carrying out your research you may want to try Morningstar.
Here is what you need to keep in mind as you prepare to decide between Morningstar and Zacks.
- They are both among the most popular investment research tools in the market
- Zacks is popular for its ranking system that plays a huge role in finding ETFs, mutual funds, and stocks that are rapidly rising
- Morningstar's features a star-rating system that analyzes securities based on the reward compared to the risk
- Zacks is costlier and targets seasoned investors while Morningstar is more affordable and targets all kinds of investors
MorningStar Vs Zacks: Final Verdict
Investing is a great idea but making the right decision as far as where to invest can prove to be a challenge. Of course, you don't want to gamble with your money. The Zacks and Morningstar platforms both offer powerful tools for investors as far as analysis and research.
If you are more familiar with investing, we would suggest going for Zacks and if you are a beginner, Morningstar would suit you best.
Blake is a self-made online day trader with a knack for adventure. On his free time, he loves reading and learning new methods in the trading as well as improving his jiu-jitsu skills. He currently resides in New York City.