So you’re wondering what a stock screener is…
Here’s the short answer:
A stock screener is a tool that allows investors to filter (or “screen”) stocks, mutual funds or ETFs based on specific criteria and/or metrics of your choosing. If you’re looking for stocks that have a certain market cap and declined 20%+ you can easily generate a list to peruse. They’re fantastic for narrowing down your options and having a more manageable list to make your final selections from.
Stock screeners are the secret weapons of small investors since they make quick work of sorting massive amounts of data. This lets you expand into a larger universe of potential investments to choose from, which also increases your probabilities of finding some above-average performers that you might have not discovered otherwise.
One way to get above-average returns or have a portfolio that doesn’t move in-sync with the market is to invest in stocks that aren’t common household names. I’m not saying the more obscure the better, but sometimes those obscure stocks or secondary stocks, when purchasing a basket of them and holding for around a year can give you some very impressive gains.
Stock screeners can be used by investors or traders/speculators, but I only use them as an investor, mainly for fundamental metrics, and occasionally for momentum metrics (usually screening for 52-week lows coupled with fundamentals-based metrics) and I recommend using them similarly.
How much do stock screeners cost?
Some stock screeners are free and others are paid.
If you have a brokerage account with any of the major online brokers you probably already have access to a very good free one. There are screeners that have a freemium model with a robust free version, like Finviz, where they’re paid version has more bells, whistles, metrics, export features, etc.
I personally don’t currently use Finviz’s screener and don’t recommend it for beginners since it’s user-interface is overwhelming.
There’s also the Yahoo Finance free stock screener that’s pretty good, and like most screeners, they have preset screens to get you started with criteria for:
- Undervalued stocks
- Growth stocks
- Tech stocks
- Small-cap stocks
- High dividend stocks
- Top % gainers
- Top % losers (I’m a big fan of screening for stocks with big price declines, looking for overreactions where the price and value become unhinged)
- Different Sectors
Note on screening: I usually exclude the Financial and Energy sectors since those companies don’t screen well with other sectors and usually create headaches. If interested in those sectors screen those separately to keep things clean, relevant & comparable.
Stock screeners I personally use
I personally use the stock screeners that are included with my brokerage accounts and haven’t paid for one yet since for my needs they are good enough. They’re not perfect, since they’re missing a few metrics I’d like to be able to use, but I use alternative metrics in place of those. Another reason I like using the screeners in my brokerage accounts is that I can save the screen criteria and re-use the same screen later or make tweaks to it.
You can also save criteria with Yahoo (and probably Finviz), but I prefer not creating yet another login for this purpose and prefer to save my screens within accounts I already have.
Currently, I’m using the Schwab one since it allows exporting to Excel of up to 1,000 rows of data, Fidelity’s exports up to 500 rows (previously 200 rows and have recently upped the number, probably due to feedback and competition from Schwab).
Stock screener on steroids. Stock Backtesters.
An interesting tool that takes stock screeners to the next level is a stock backtester, I won’t get into backtesters too much here, they’re basically screeners on steroids that quants use—I’ve gradually been moving closer to the quantitative investor—aka quant—side and incorporating some of their methods, but I’m more hands-on with selecting the final list of stocks I invest in and not looking to convert to being 100% quant anytime soon.
Backtesters combine a screener AND historical data to rank companies and retroactively test a rules-based screen strategy to see how that portfolio would have performed in the past up until the present.
And when you find a quant strategy/screen which performs extremely well you use the same screen criteria to build a real portfolio to invest in and hope that it has similar outperformance.
One cool paid backtesting tool that I’ve read others discuss that’s user-friendly and doesn’t require coding is Portfolio123, I haven’t used it, since I’m not there (yet), but plan to check out the free trial in the future and see if the ROI is there to rationalize the subscription fees.
Where to find stock screeners in your brokerage account
Here’s where to look within four of the big online brokers to find their various screeners
Charles Schwab stock screener
Fidelity stock screener
Fidelity makes it a little more confusing to get to the screeners, for their mutual fund screener you go to “News & Research” in the main menu, then to “Mutual Funds”. This brings you to a basic screener. To get to the more robust mutual fund screener see the image below for that little arrow to click:
The Fidelity ETF screener is similarly confusing, you go to “News & Research” in the main menu, then down to “ETFs”, look at the bottom of the first section labeled “ETF Screener” and find the small link towards the bottom that says “Launch ETF Screener” to get to the real ETF screener.
TD Ameritrade stock screener
E*Trade stock screener
With E*Trade you go to “Markets & Ideas” in the main menu and then down to “Stocks” and then a sub-menu appears below the main menu and then you hover on “Stocks” and then click on “Stock Screener”.
To get to the screeners for ETFs and mutual funds you find whichever you want in the sub-menu of “Markets & Ideas” and then hover over it and find the screener link.
General ways to find screeners in brokerage accounts I didn’t cover above
Check the “research” sections, look for the words “screen” or “screener” or look under the stock, mutual fund or ETF sections, since they could all be in slightly different places or a tab away.
I mainly discussed “stock screeners”, but they work great for ETFs and Mutual funds and I occasionally use them to find ETFs.
The screen criteria you’ll use for ETFs/funds versus stocks are quite different and both require a little more effort and digging to create your own personal index fund, but if it’s something you’d like to learn more about and have questions feel free to leave it in the comments or contact me and I’ll do my best to help and get you further along the path.
The dollars are hiding and a screener is your GPS. Happy hunting!
Oh, and happy Father’s Day too!
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