6 tips that will make you a better headline writer

Writing pithy, eye-catching headlines in investment research is a near impossible task due to fundamental and regulatory constraints.??

In results notes, for example, there are only a few scenarios to write about. Earnings are either up a little or a lot, down a little or a lot, or flat. There can also be a bearish rise (“Momentum fading”) or a bullish fall (“Light at end of tunnel”).?But these are the basic seven situations.?

As most analysts write on 10-20 stocks at least four times a year, that means 40-80 times a year saying some variation of “Strong results” or “Weak results”. Eventually you run out of synonyms to vary the language, leaving the same old tired phrases.?

Moreover, regulators prohibit the inciting of emotions such as anger, urgency or greed, which would make for more fun headlines and is a proven tactic for getting clicks. That rules out the likes of “Cheap as chips: fill your boots” however much it may be what you really mean.?

Style guides and compliance departments may also ban song titles which is a loss because they are a rich seam, while the need to appeal to a wide audience means cultural nuance has to be removed. Part of the appeal of the cheeky or lurid headlines in racy tabloids such as The Sun in the UK or New York Daily Post is the clever word-play using local themes. But allusions to cricket will fall flat in NY or Tokyo. ??

Finally, jokes and puns may either sail over the head of the reader or fail on the grounds of taste. That rules out a reprise of the classic “Cannot Recommend A Purchase” (spot the acronym). The headline must also express the key message of a note accurately (no clickbait).?

In short, the acronym TACT is a guide – headlines should be Tasteful, Attractive, Clear and Truthful. Put another way, they should be informative like those in a broadsheet newspaper, rather than sensationalist like a tabloid.?

With these principles in mind, I compared the headlines on publicly available research published by a selection of large and small research houses to see how they do it. This is what I learned:?

1. If you do nothing else, provide a viewpoint rather than just bare information. The reader wants to know what the analyst thinks after all. “Q3 operating update” or “The US economy in 2024” don’t give much of a hook for the reader to want to click. Better to say at the very least “Positive Q3 operating update” or better “Q3 operating update: strong momentum continues”.?

2. Favour the bland over the information-less. Headlines fail if they are both bland and lacking information, e.g. “The times they are a changing”, as I saw on one equity report. If the choice is between a headline that is quirky but has no information and one that is bland but has information, go for the bland one.??

3. Highlight the unexpected. According to one piece of research about social media, if there is a surprise finding in a headline it increases the likelihood of it being shared by 14% (source: Buzzsumo). “Cash generation escalates” was one example of this approach.?

4. Ask questions. According to Orbit Media, social media posts with questions are more likely to be clicked than those without, as they prompt the reader to want to know more. Goldman, JP Morgan and Citi use questions liberally in their market outlooks. Or put a “Why” in the title without a question mark, e.g. “Why stocks will continue to rise”. ??

5. Do two-parters. Start with a fact, then follow it with a viewpoint, e.g. “Profits up, but likely end of growth spurt” is better than just “Profits up”.?

6. Remove unnecessary words. The word “currently” appeared in one headline I saw. It is redundant at the best of times but particularly in a headline as the “now” implication is assumed and the word is therefore taking up valuable space. Basically, the pithier the better.?