I have been using Compustat data on Portfolio123 since 2015. When we made the switch to FactSet in 2020, we told users that they could get a license from S&P (Compustat’s parent company) and continue to use their data. Some of our users did so. The licenses are not cheap–probably upwards of $12,000 per year. But in my opinion, they’re worth it. If I ever stop working for Portfolio123, I will definitely buy a license from S&P.
FactSet’s data is better in several respects. FactSet offers a better classification system, in my opinion. And their coverage of small and foreign companies is quite a bit wider.
But what I like about using both Compustat and FactSet is that I can design ranking systems for each data provider and then compare the results. If a stock ranks very high according to both Compustat and FactSet, I’ll definitely buy a lot of shares; if it ranks high according to only one data provider, I’ll buy about half the number of shares.
This increases the diversity of my holdings and provides a great safety check for my biggest positions.
Compustat data is more point-in-time than FactSet’s, so I find using Compustat especially useful for backtesting strategy parameters using simulations.
So if you can afford it, I would encourage you to explore getting an S&P license. If you’re interested, contact me at yuval@portfolio123.com and I’ll put you in touch with someone at S&P.
On the topic of CompuStat data–and for those who happen to use earnings estimates–did P123 institute a lag in the earnings estimates data for CapitalIQ when you instituted this for FactSet?
If I end up paying $12,000 as you recommend, possibly something worth knowing ahead of time, I think. Something I would like to know before doing that if you know the answer.
Yuval, I’m curious what kind of screening/formulas you can run with the Compustat data? I assume their data license includes some predefined financial ratios, etc, but is it possible to apply any of the rules/functionality we’ve created in our P123 screens to Compustat data?
There are only two things one can do with FactSet that one can’t do with Compustat:
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[]Use the Consensus Estimates functions (ConsEstMean, ConsEstHi, etc.)
[]Use RBICS codes
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For everything else, all the commands are the same. A few line items are calculated differently, but not many.
Ok, thanks Yuval. Maybe a dumb question, but are you saying that if we purchase a separate data license with Compustat we can integrate or somehow run that data through the P123 screening functions, etc?