AI for Serious Investors #2: Three Skills That Will Improve Your Research
3 Claude Skills I built to speed up research: competitors, proxy incentives, and forensic accounting analysis.
In AI for Serious Investors No. 1, we covered what Claude Skills are, how to install them, and you got the Special Situation Screener Skill to improve your idea generation. In this article I am going to share three new Skills that I developed that you can start using right away to improve your research.
Quick Note to Paid Subscribers: As usual, all the Skills in this article are free for you. Just head to the end to find the 100% off codes. When you use them, no payment info is required, you will be able to download the Skills right away.
I have a lot more AI-related tools in the pipeline that are in various stages of development, so before we dive into what I am releasing today, I want to establish a framework for you to think about where each tool fits in.
Starting with today’s article, for each AI resource that I release I will give you:
The stage where it fits into the investing process
Degree of technical savvy required to use it (Low/Intermediate/Advanced)
What tools/resources you need to already have to use it
Expected time per use
This way you can select the resources that are best suited to your own workflow and situation.
In my 5 Sources of Investing Edge article, I covered the stages of an investment process:
Each AI resource will be classified into one or more of the 5 investing process stages: Idea Generation, Research, Investment Decision, Portfolio Construction and Information Processing.
This system will let you quickly understand where an AI tool fits in and whether you want to use it in your own work. Without further ado, let’s get to today’s Skills.
Competitors Skill
Investing Process Stage: Early Research
Technical Savvy Required: Low
Pre-requisites: Claude subscription, works in web browser
Expected Time: under 2 minutes per run
This Skill quickly researches who the competitors are of a company and provides you with a brief overview. This is useful in a few ways:
As part of building a to-do list for further research on a new company you are working on
As a sanity check on a company you think you already know well
As a building block for future AI tools that might be able to take the output and automate other steps in the investing process
Download the Competitors Skill here.
Proxy Analysis Skill
Investing Process Stage: Research
Technical Savvy Required: Low
Pre-requisites: Claude subscription, works in web browser
Expected Time: under 2 minutes per run
This Skill works for U.S. companies, finds the latest Proxy Statement, and analyzes management incentives. I believe the way management chooses to pay themselves is an important signal about how aligned they are with shareholders. A compensation system that matches your philosophy is a positive sign.
I use this Skill early in my research, and sometimes even at the tail end of idea generation. Remember, you want to kill bad ideas quickly. If I see a poor incentive structure I might kill the research right at the start and save myself hours.
If I see an incentive scheme I particularly like, I might bump that candidate up my priority list. In my case, I have a strong preference for ROIC or Economic Profit related incentives. So beyond just digging up the usual disclosures, the Skill grades them 0 to 10 on how heavily ROIC-related factors influence management pay.
Companies that heavily weigh ROIC-related factors in compensation are rare. That might be an interesting positive signal for choosing which ones to research deeper. We did a test on a random sample of 100 U.S. companies, and here is what we found:
84 had no ROIC-related factors in their management compensation
The 16 that did had a score that ranged between 2 and 9
Only 5 companies out of 100 had a score of 6+
Download the Proxy Analysis Skill here.
Forensic Accounting Analysis Skill
Investing Process Stage: Research
Technical Savvy Required: Low
Pre-requisites: Claude subscription, works in web browser
Expected Time: under 10 minutes per run
Accounting issues range from mild earnings smoothing to outright fraud. One way to guard against them is to look for companies with strong FCF relative to Net Income. However, that is not enough.
This Skill takes the last 5 annual 10-K filings for a U.S. company and does a 2-pass forensic accounting sweep looking for red flags. The first pass uses Howard Schilit’s Financial Shenanigans framework. The second is an independent pass using broader forensic heuristics. I highly recommend Schilit’s book to all my students as a great resource for learning how to detect financial statement manipulation.
Warning: Because this Skill requires a lot of information to complete the pass, very infrequently it will abort in Claude’s web environment due to context window size constraints. In our testing this happens well under 5% of the time so I still find it to be highly useful. If you are an advanced user and this bothers you, reach out as I have built a Claude Code version of this Skill where this isn’t an issue.
Download the Forensic Accounting Analysis Skill here.
Conclusion
I have a full pipeline of other AI-related tools that I am excited to share with you in future articles, so stay tuned!
Two disclaimers:
AI can (and probably will) make mistakes. I tested these Skills and use them myself but sometimes a) a run may abort due to technical issues or b) some of the info can be off. I have found these cases to be rare and an acceptable cost of using tools that most of the time work well. You will have to make that tradeoff decision yourself.
This is not investment advice; I am just sharing my work with you and strongly encourage you to both check any AI tool you use and always make your own investing decisions.
Do you have an idea for what investing-related AI tool I should build next? Please leave a comment or send me a DM. If I end up building your idea, you will get it free even if you are not a paid subscriber.
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