With tens of thousands of stocks to choose from, you have to narrow down your investment choices. The internet offers a number of stock screeners that can help you find stocks that meet specific criteria that matter to you. From that pool of stocks, you can choose the ones that best meet your investment needs. This ability to focus on stocks with the attributes you're looking for helps you become a better-informed investor.
Select an online stock screening service. Several websites offer these services at no cost. Even the paid services offer a free trial. Find reviews of the most popular stock-scanning programs at the Swing Trade Stocks website.Step 2
Examine the preset screens. You will find preset screens that search for value stocks, growth stocks, stocks of small companies or large companies and out-of-favor stocks. Decide if any of these meet your criteria. For example, if you want to search for stocks that currently have a low price-to-earning ratio, a preset screen may offer you a list of these.Step 3
Create a custom scan. Enter your criteria in the search fields provided on the blank stock-scanning screen. You can search for stocks with the highest-paying dividends. You can look for stocks that have reached 52-week highs or 52-week lows. Some scanners allow you to look for stocks that have experienced exceptionally high volumes of trading or exceptionally low volumes. The number of options depends on the scanning service you use. Many scanners allow you to simply click these options, while others ask you to enter your criteria. For example, you may find a drop-down window that lets you choose "highest" or "lowest" for trading volume.Step 4
Narrow your choices. When you have a list of stocks that meet your criteria, reduce the number you will consider by adding other criteria. For example, if you scanned for stocks paying the highest dividends, you could eliminate those that have less than five years of data, opting instead for mature companies.
- You don't have to know what kind of stock you want before you use a stock-scanning service. Use stock scanners to help you find your criteria. For example, you can explore the types of stocks that show up on a screen for value stocks and compare them to stocks that show up on a screen for large-growth stocks. You can learn about your own tastes in this way.
Kevin Johnston writes for Ameriprise Financial, the Rutgers University MBA Program and Evan Carmichael. He has written about business, marketing, finance, sales and investing for publications such as "The New York Daily News," "Business Age" and "Nation's Business." He is an instructional designer with credits for companies such as ADP, Standard and Poor's and Bank of America.