Should You be Using Stock Screeners?

A stock screener is a digital tool that displays a filtered selection of the stocks that seem to be ideal for your financial strategy. With a stock screener, you can avoid spending hours or days searching through the thousands of stocks on the market, and instead receive an overview that’s tailored to you according to specific parameters like price per share or the estimated earnings of the company. With a stock screener, only the shares that “pass” through the filter will be exposed in your final results.

Stock screeners like the Finviz screener are incredibly popular, but they’re not right for everyone. In fact, many experts recommend that you should only use a stock screener as the preliminary step in your research. This is because things like market opinion, reviews, and product response are things that a stock screener can’t measure. All of these things still need to be considered when you’re looking for the perfect stock.

Knowing What to Screen For

Most of the basic stock screener solutions on the market come with a pre-set selection of metrics that you can choose from to find your preferred range of stocks. For instance, you might be able to look for the stocks you need according to market cap, or you might search according to debt and equity. It’s also possible to search for various things at once. If the screeners with a pre-set selection of metrics don’t work for you, you can even find some tools on the market that offer even more customizable options to choose from. However, it’s worth noting that the more in-depth you go with your screener, the more complicated the tool will be to use. Make sure that you understand the market before you begin playing with variables that you don’t fully understand.

The biggest problem most people face when using stock screeners is that they’re not sure which criteria they should be searching for. There are hundreds of variables, and if you’re just getting started in the stock market, it’s difficult to know what’s right for you.

Using Stock Screeners

Screeners are extremely flexible tools for people who need more information on the stock market to help them decide about their financial future. However, if you don’t know what you’re looking for, then you can’t get much out of these tools. Ideally, if you’re a beginner, then you’ll need to choose a screener that offers a predefined screen to help you get started.

The most important thing to remember is that stock screeners aren’t the magic solution for choosing the best stocks. Screeners don’t consider qualitative factors that are still important to trading, and some screeners use databases that might be slightly outdated. Ideally, you’ll still need to use plenty of real, authentic research to make sure that you’re getting the right results with your stock screener. The screener itself is just the launching pad that you can use to figure out where you want to further your search, rather than wasting time on stocks that might not be right for you.