What Is a Stock Screener?
Key Takeaways: A stock screener is a tool investors use to comfortably find the best stocks to buy. Many stock screeners work with the daily, weekly and monthly time frame and provide insights into company fundamentals such as market capitalization, earnings per share and dividend payments.
An alternative to a traditional stock screener is the stock scanner. The stock scanner scans the market in real time and is mainly used by day traders. See Also: Stock screener vs scanner
The price of a stock screener mainly depends on the data quality. Free stock screeners are suitable for long-term investors and basic analysis, while day traders should invest in high-end products with real-time tick data.
Stock Screener Use Cases
Are you looking for an effective way to find stocks that meet your well-defined investing criteria? Or are you looking for pre-configured criteria showing the best stocks to invest in based on company fundamentals or technical analysis?
A stock screener can help. By using a stock screener, investors and traders can quickly identify potential investment opportunities in the market. A screener helps narrow the vast number of available stocks to the best ones to invest in by applying specific filters or criteria important to their investment strategy.
Stock Screener Filters, Criteria and Alerts
Stock screener criteria can be fundamentally based (EPS, market cap, dividends) or technical (new all-time high, moving averages, distance to VWAP). A stock screener allows users to filter through thousands of stocks based on specific parameters, such as price, volume, sector, or any combination of these factors. This makes it easier for investors to find the right stocks for their portfolio without manually searching through all available investment opportunities.
Benefits of Using a Stock Screener
Using a stock screener has many advantages over traditional methods of researching potential investments. First, it saves time by allowing you to quickly narrow down your choices from thousands of possible candidates in just minutes or even seconds. Additionally, it provides access to data points typically unavailable when conducting manual research, such as technical indicators like moving averages (standard and exponential), VWAP or the Relative Strength Index (RSI).
In addition, some stock screeners offer backtesting capabilities, allowing you to test different trading and investment strategies before committing real money to them. This can be especially useful if you’re new at investing or day trading.
Finding the Right Stocks for You
After setting up your search criteria and running a search on the stock screener, you will be presented with a list of stocks that match those criteria.
This list can then be sorted by various metrics, such as price-to-earnings ratio (P/E), dividend yield or market capitalization, all-time high prices, etc., to find stocks that best fit your investment goals.
Additionally, some stock screeners allow users to add additional filters such as the total volume of a stock traded or average daily trading range, the position in the previous day range, etc., so they can further refine their results and hone in on potential investments more precisely.
Once you understand the criteria and filters available, you can utilize stock screeners as an effective tool for discovering stocks that meet your individual investing needs. With this knowledge, let’s explore some of the most commonly used filters in stock screeners.
Setting Up Your Criteria
Before you start using the stock screener, setting up your criteria is important. First, decide what factors are most important for your investment strategy would be best, such as price-to-earnings ratio (P/E), dividend yield, market capitalization, sector or industry groupings, etc. Once you have determined these criteria, enter them into the appropriate fields in the stock screener and start the search.
Commonly Used Filters in Stock Screeners
By using filters, users can narrow down a large universe of stocks to find those that fit their investment goals and strategies.
They allow users to search for individual stocks based on price range, trading volume, or other related metrics.
For example, an investor may want to find stocks with:
- Prices between $50 and $100 per share
- That have traded at least 1 million shares on average per day in the past month
- With a positive projected EPS growth in the next five years
Done manually, it takes weeks of analysis efforts. On the other hand, using a stock screening tools shows the results in a minute. Therefore, filtering with a stock screener helps investors quickly identify potential market opportunities without manually sifting thousands of stock listings.
Fundamental Analysis Filters
Fundamental Analysis Filters enable users to search for companies based on financial performance metrics such as:
- Earnings growth rate
- Insider ownership
- Return on equity (ROE)
- Price/cash ratio
- Dividend ratio
- Debt-to-equity ratio (D/E)
- P/E ratio
- Market cap
- Operating cash flow
- Profit margins
- Distance from the all-time high
These filters provide an easy way for investors to compare different companies’ fundamentals side by side before making an investment decision. Specific criteria allow users to filter stocks based quickly and provide the result as a table, graph and exportable file.
Technical Analysis Filters
Technical Analysis Filters help technical traders identify stocks with specific chart patterns or technical indicators such as:
- Moving averages
- Relative strength index (RSI)
- Chart patterns
- Average True Range (ATR)
This type of analysis is often used by day traders who look for short-term price movements rather than long-term trends in fundamental data points like revenue growth or profitability ratios.
With these filters, traders can quickly spot potential trading setups in the markets they follow most closely.
Finally, many popular stock screeners also offer advanced features such as backtesting capabilities, allowing users to test their strategies against historical data sets before putting real money into play.
This feature is handy for experienced investors who want to refine their investing strategy and approach over time while minimizing risk exposure.
Stock screeners with fundamental and technical analysis based filters are a valuable tool for traders and investors, efficiently narrowing down potential investments. By understanding the commonly used filters in the most popular stock screeners around, you can begin to create a tailored strategy that fits your individual needs and goals – which is why it’s essential to consider all available options when selecting the best stock screener for you.
Tips for Choosing the Best Stock Screener for You
When choosing the best stock scanners and stock screeners for your needs, there are a few key factors to consider. First, researching different platforms and features is essential to determine the most suitable one.
First, decide what type of screener you need. As an investor, you want to consider traditional stock screeners focusing on fundamental data. In contrast, as a trader, you want to consider using a stock scanner that scans the market in real-time, tick by tick, based on stock price movements and technical analysis aspects.
Consider your investment goals and strategy when selecting a stock screener as well. For example, are you looking for short-term or long-term investments? Do you prefer stocks with high volatility or low volatility? Knowing these answers can help narrow down your choices significantly. In addition, stock screening of various trading instruments makes own research easier, considering that thousands of stocks are listed on exchanges worldwide.
Look into what types of filters the tools offer, how easy their interface is to use, and any additional features that may be beneficial.
Many stock screeners and scanners are freemium products or offer users a free trial. Test the tool inside out. If a free stock screener does the job, great! Consider using a more expensive scanner if you need highly accurate real-time data.
Research Different Platforms and Features
It is essential to research the different platforms and features when selecting a stock screener to ensure you know what service it provides.
The most frequently used stock screeners and analysis tools for investors are:
- TradingView (a good stock screener for international markets and multiple assets)
- Finviz (excellent stock screener with data export functionalities)
- TrendSpider (combined screener with technical analysis)
The most popular scanner and analysis software solutions amongst day traders are:
- Trade Ideas Pro (stock screens and scans)
- Benzinga Pro (stocks screens + news feed)
- Black Box Stocks (stocks + options)
Consider Your Investment Goals and Strategy
Before settling on a particular stock screener, it’s crucial to consider your investment goals and strategy first. This way, you ensure that the chosen tool meets all necessary criteria, such as risk appetite, desired returns, etc.
For example, if someone is interested in short-term gains, they might want more volatile stocks. In contrast, someone else might prefer less risky but longer-term investments requiring them to choose stock screeners providing data-related fundamental data.
A stock screener is an invaluable tool for traders and investors looking to make informed decisions in the stock market. They enable users to find stocks that meet their investment goals quickly.
Finding the right one for you may take some time, but it’s worth it when you can use a powerful tool like a stock screener to maximize profits from your investments.
Once you have chosen a platform, practice using it until you become comfortable with its features before investing real money into any trades or investments suggested by the screener’s results.