[Link].

com/valueinvestor

Zacks Investment Research, Inc. | 101 N Wacker Drive, Floor 15 | Chicago, Illinois 60606
Contents

Introduction 3

Section 1: How to Get Started 4

Section 2: The Mental Aspect 5

Section 3: Getting the Most Out of Zacks Value Investor 7

Section 4: Follow the Leader 8

Section 5: How to Read Zacks Value Investor Alerts 9

Section 6: How to Read Zacks Value Investor Daily Summary 10

Section 7: Virtues of Money Management 11

Section 8: Tying it All Together 12

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Introduction
Congratulations on getting started with
Zacks Value Investor!
Value is not just an investing style. It’s a way of life.

Realize that there are people out there who would cheerfully buy a new TV for $2000 when the store
down the street is selling it for $1295.

If you get it, then we are going to be good friends for a long time. If not, then you might as well ask for
a refund now and find an investment service that better suits you.

Here is our game plan. We are going to find the best value stocks for the long haul. And we do that by
combining 3 vital ingredients:

Fundamental Momentum: We will look for companies where their earnings are exceeding
expectations now and should continue to do so into the future. And the Zacks Rank is our best friend in
this endeavor.

Classic Value Principles: We will scour the landscape looking for stocks trading at 25%+ discount to
peers. PE, PEG, Book Value and other metrics will be applied.

Upside from Growth: If you buy a slow growth company trading at a 25% discount to peers, then once
it goes up 25% the party is over. However, if you focus on growth stocks trading at a discount, then the
profit opportunity over time is more like 50%, 100%, 200% and beyond. That is what we are looking for.

We will provide you with market insights, education and great value picks.

If finding value is part of who you are, then you have found a home with the Zacks Value Investor.

Welcome aboard!

Tracey Ryniec
Editor, Zacks Value Investor

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Section 1:

How to Get Started

At any given time the portfolio will have 25-30 pre-existing recommendations. So the most common
question with new members is about how to get started with these positions. This section will help you
get on your way.

1. How Many Picks: First determine how many of the picks you intend to add to your portfolio.
We recommend that you buy them all even if you have a smaller portfolio. Why? Because too often
when customers pick and choose they often miss out on some of the biggest winners (it’s a Murphy’s
Law kind of thing).

Given that this is a long term service with little turnover means that commission costs will be very
low with any online broker. So please strongly consider taking all the recommendations.

2. Green Doesn’t Mean “Buy and Buy and Buy”: We are not believers in just buying
and buying and buying shares if they are under their target price. That’s because we believe in a
diversified portfolio where no singular position takes up more than a 10-15% allocation. Thus, if you
have already taken a position in a ZVI recommended stock and it’s still in the Buy category…then
you are set. Look to add money to other positions on the list that are not already in your portfolio.

Why? Because value investors have one really bad habit. And that is too often they keep buying
shares on the dip. And too often they end up with their biggest position as the biggest dog in the
portfolio (i.e. Sometimes stocks go down for good reason and you should not pick up more shares).

So stick with the mantra of being diversified with your ZVI picks and using your money to add other,
Buy rated recommendations.

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Section 2:
The Mental Aspect
To take a quote from Yogi Berra: “Half of investing is 90% mental.”

It is important to realize how much investment success is related to what goes on between your ears.
There are so many ways to get distracted and to question yourself while investing. You must be in the
right frame of mind and have reasonable expectations to achieve success with this or any investment
service. So be sure to pay attention to the tips in this section carefully; they will get you headed in the
right direction.

NOBODY IS 100% PERFECT

First of all, there will be losing picks. Let me repeat: there will be losing picks. However, our aim will be
to cut the losers early to minimize losses and let the winners run to maximize gains. In doing so, we can
achieve fantastic results.

A little known fact is that the Zacks Rank, even with its +24% average annual return, is only right 56%
of the time. We are extremely confident that over time we will produce substantial returns, but it is
important that you learn to take the losing picks in stride.

OUR BRAND OF VALUE INVESTING

The Zacks Value Investor is unlike any service out there. Our system combines the proven power of the
Zacks Rank with the discipline of value investing. Our research has shown this to be a phenomenally
profitable combination.

You see, we are value investors at heart. We believe that price and value are not the same thing. Mr.
Market can overreact at times and present some wonderful buying opportunities. That’s where we
come in with cool heads and a long-term time horizon to scoop them up with both hands.

Research has clearly shown time and again that the best performing stocks over the long haul are not
growth stocks, but value stocks. Our extensive backtested research studies confirm this. Stocks with low
prices relative to their earnings, cash flow, book value, or sales have shown significant outperformance
over the long haul. And the lower the valuation metric, the greater the outperformance tends to be.

Contrary to what you might occasionally hear in a bull market, valuation does matter. And it will matter
a lot as we meticulously select winning stocks for the Zacks Value Investor portfolio.

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ZACKS RANK + VALUE INVESTING = A POWERFUL COMBINATION
Of course some stocks are “cheap” for very good reasons, and low valuations alone are certainly no
guarantee of high returns in the future. We’ve all been guilty at one time or another of buying “value
traps” or “falling knives”. But this is where the beauty of the Zacks Rank comes in.

The Zacks Rank identifies companies with positive earnings estimate revisions. These stocks
experiencing improving earnings outlooks have materially outperformed the market year-after-year. But
the Zacks Rank is completely blind to valuation metrics itself.

When we combined the Zacks Rank with key valuation metrics in our research, the results were even
more spectacular than looking for either one in isolation. Therefore, when we hunt for stocks with both
strong earnings momentum and attractive valuations, we will grab less falling knives and more hidden
gems.

The market can sometimes take a while to catch onto these undervalued stocks, so be patient. Our
targeted holding period is around one year. When we do happen to catch that falling knife, we will cut
it loose early and look for other opportunities. By cutting our losers early and letting our winners ride,
we fully expect to achieve market-beating returns over the long haul.

Of course, not all of our winners are going to turn into multi-baggers like Priceline or Amazon. We
expect to have many 25%, 50% and 100% gains. But we’ll constantly be on the lookout for those
extraordinary wealth building multi-bagger opportunities.

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Section 3:
Getting the Most Out of Zacks
Value Investor
It is our job to provide you with timely and profitable stock picks, but there are steps that you can take
to ensure your success with Zacks Value Investor. Here are a few things you can do to get the most out of
the product.

1. Read this Guide carefully

„ This guide is your friend. It has valuable information on how to use the product and succeed
with the assistance of Zacks Value Investor.

„ It gives you step-by-step instructions on how to receive alerts and what to do when you receive them.

„ It has important money management tips.

2. Have a working email address

„ This is necessary to receive trading alerts. Make sure you can access your email in a timely
fashion because acting on trades is essential to success.

„ The Summary emails will be sent around 8:00 p.m. EST, which summarizes the positions as well
as what happened on Wall Street.

„ Intra-day trading alerts, while rare, will typically be sent within the first hours of the trading day.

„ Unfortunately, many Internet service providers have software programs that filter out emails
you want to receive, like Zacks Value Investor Summaries. To get optimal delivery of our emails
follow this link for quick and easy instructions.

3. Have an online trading account

„ We do not promote any particular company for this, but ideally lower commissions will help
you achieve higher overall returns. You will make several trades a month, and high commissions
can really eat into your profit margins, especially if you have limited capital.

4. Access the site

„ To access the site, go to [Link]/valueinvestor and enter your username and password.
This will take you to the main page where you can view the portfolio, any pending trades, and
the commentary.

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Section 4:
Follow the Leader
The process to receive our trades is very simple, yet we feel it is so important that we are going to spell it
out for you. Here are the four steps:

„ Receive the email with the daily summary or intra-day signal

„ Read the email to determine appropriate action

„ Place trades through your broker with the appropriate % allotted

„ Follow the emails to determine when to sell

ACT PROMPTLY = MOST SUCCESS

And if you don’t beat the market, you can take advantage of our 100% Money Back Guarantee.

SPEAKING OF THE GUARANTEE……….

We feel that if we are not able to live up to our word and help you beat the market then we shouldn’t
be deemed worthy enough to take your money. So in addition to the 90-day, no hassle guarantee, there
is a 100% Money Back Performance Guarantee.

There are a few conditions that have to be met first, but the bottom line is that we have to perform.
Click here for details.

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Section 5:
How to Read Zacks Value Investor Alerts
From time-to-time, this strategy will have a trading alert during the trading day. When a Buy Alert, Sell
Alert, or Intraday Alert is sent out, you should receive the alert within the first hours of the trading day
detailing what stock is being bought or sold and the rationale behind the move. It is important that you
act as soon as you can. Here is an example:

Signal = The type of alert. It will be a

green ball for a “buy” alert or a red ball
for a “sell”.

Company Name = The name of the

company that is being added to or
sold from the Zacks Value Investor
portfolio.

Symbol = Ticker symbol of stock being

added to or deleted from the portfolio.

Date Added = The date on which the

stock was added to the portfolio.

The alert will also show the current

price at which the stock is trading, as
well as the market cap and industry of
the recommendation.

Zacks Value Investor Portfolio

Commentary = As part of the alert,
Tracey will explain her rationale for the
addition. You will learn her reasoning
for adding or selling the stock. Intraday
alerts use the average of the price at
the time of the alert and the closing
price that day.

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Section 6:
How to Read
Zacks Value
Investor Daily
Summary
The Summary provides a wide array
of details for the Zacks Value Investor.
This summary may have new signals as
well as the current open portfolio with
commentary. This is valuable information
as it conveys what our game plan is, why
we are in each stock, when to get out
and why, as well as any relevant news.
This is emailed to you around 8:00 p.m.
EST. In regards to the price added for the
portfolio, Zacks uses the average of the
price at the open and the closing price on
the day the stock is added and deleted.

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Section 7:
Virtues of Money Management
Money management can be the difference between realizing large gains and going broke, even if the
winning percentage is the same. How can this be? The key point is that winning investors know to ride
their winners and cut their losses quickly, and stick with a plan that has proven to work in the past.

Here are a few rules that you can follow to further improve your returns:

First of all, don’t dump your entire portfolio into these Zacks Value Investor picks. Only allocate that
portion of your capital that can be comfortably devoted to speculation.

This portfolio will typically hold 20-30 positions. You should be able to sleep soundly and act rationally if
you are only trading with your speculative money.

Keep in mind that reinvesting profits and the power of compounding are your friends in this portfolio.

EVER-PRESENT CLICHÉ RINGS TRUE

It has been said millions of times before, but it is so important it needs to be said again: Don’t put
all your eggs in one basket. Even if you are the most brilliant investor in the world, there is no way of
knowing for sure that an investment will go your way. There will be losing trades. The key is staying
in the game and building your equity over time in a systematic way. This can only be done when
diversification is put to use.

Not that we have to remind you, but the main point is that your capital was earned through years and
years of hard work. Capital conservation sounds boring, but without it, you are fighting a losing battle.
We don’t want to see the money you have put your blood, sweat, and tears into evaporate due to lack
of discipline.

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Section 8:
Tying it All Together
It is our goal at Zacks to enhance your investing results via the Zacks Value Investor service. This booklet
touches upon the details of the service and provides several useful tips to realize the vast potential that
these stocks hold. We feel it is our job to let you know that we arehere to help you get the most out of
Zacks Value Investor.

Again, let’s go over some of the important points made in this booklet.

„ Small Gains Add Up To Big Results

„ Not Every Trade Will Be A Winner

„ Timeliness Is Of The Essence

„ Money Management Matters Greatly

„ Have A Working Email Address

„ We Are Here To Help

The last point is important as we have free customer support that should be taken advantage of. Any
additional questions that you may have can be answered by just picking up the phone and giving us a
call or emailing us:

1.888.775.8348
(outside the US, 1.312.265.9309)

valueinvestor@[Link]

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