Stock Screening
Tools and Techniques

In the market, stock screening is the process of reducing the universe of all possible stocks to a few stocks that match the criteria of an investment strategy. It combines screens, data, and screeners.

Why bother?

Because it reduces the size of the problem we are trying to solve. It is simpler to analyze a few stocks than every possible stock. This alone should be reason enough to learn the process.

Professionals bother because it is how they find stocks.

You should bother because it allows you to identify your sweet spot in the market. It is the most efficient way to find stocks with the characteristics that matter to you.

Even better, it makes your investing systematic and repeatable.

Helping you to identify the tools and techniques for your investing sweet spot is what this site is all about.

Don't confuse Screening and Stock Screeners

Screening is a process; screeners are tools. It is easy enough to find a free stock screener and run some of the canned screens. But if you don’t understand the underlying strategy, this type of screening is no better than a hot market tip.

To find your personal sweet spot in the market you need to consider more than just the tools. You need to consider the entire process. It takes some time and some planning but there can be big dividends – emotional as well as financial.

I challenge you to dig a little deeper and learn stock screening and how to really use a screener.

Bake an investment cake

The secret is that there is no secret.

John Bogle

In some ways, screening for stocks is like baking a cake. You need:

  • A recipe (strategy)
  • Ingredients (data)
  • Tools (screener) and Techniques

Your personal approach results in picking an investment strategy that reflects what you care about - like picking a recipe for your favorite cake.

Before you sort through the recipes though, you should review some underlying issues such as investment basics, personal considerations and performance expectations.

Getting started.

Once you have reviewed the underlying issues, begin with investing styles.

Each described style includes one or more investing strategies to illustrate the approach and some recommended reading for a more in-depth evaluation. The result will be a personal stock investment strategy.

Finalizing your strategy will also define your data requirements. The data you need may limit which tools you can use. Screens are provided for implementing many of the strategies, so you can practice technique using a free or low-cost screener.

The best stock screener for you will need to meet both your personal investing criteria and your budget.

Voilà

Even if you are new to investing and trading, the information on this site should be a starting point for developing a style that works for you.


NOTE:

There is no way I can or will provide investment or trading advice. Tools and how to use them, yes; how to invest, no.


If you have any questions (or corrections) or comments on topics related to this site please contact me.

Jim

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Jun 2017