A stock screener can be considered as a tool that would help investors and traders filter stocks on the basis of the metrics defined by them. Many websites as well as stock trading platforms make available stock screeners in order to enable their users or clients to choose trading instruments that are well suited for a certain set of selection criteria. For instance, users can screen for stocks that satisfy certain data criteria such as price, P/E ratio, market capitalization, 52-week percentage price change, dividend yield, average five-year ROI and average volume, among many others. Some of the forex trading platforms enable their clients to screen stocks on the basis of technical indicators. For example, traders could screen stocks whose Relative Strength Index or RSI values fall between a specific range or those that are trading above their 200-day moving average.
Identifying good stocks is not an easy task at all because of the number of companies that are listed in the stock exchanges. This is to say that the stock screener is a handy tool that all traders and investors can make use of for identifying the right stocks to invest in or trade with. A stock screening software package comes with three components as explained below:
Database of companies
Different sets of variables
The screening engine finds the names of companies based on the different sets of variables and lists them. It is easy to use a stock screening software package. The traders will have to answer a set of questions to start with and then feed in the required variables. A good software package will enable traders to identify companies that satisfy any criterion or metric.
Screening for stock ideas is not an activity that consumes a great deal of time. However, it is important to know which website would provide the best and free software package. Actually, the best free stock screening services are provided by some of the top financial websites. They equip the investors with the tools that are needed to perform high quality stock scans.
As in the case of the best free stock chart service websites, a list of the best stock screening service providers has been prepared after evaluating their performance on the basis of certain criteria. The criteria used for evaluation and ranking service providers are as follows:
Depth of screening criteria
Use of both technical and fundamental criteria
Ease of using the software
Additional functionality included
The stock screening service provided by FINVIZ.com is by far the best because of the vast selection criteria they make available. In addition, the software is very user friendly and offers a great deal of functionality. The filters offered include both the technical and fundamental analysis parameters. One of the key features offered by FINVIZ is the popping up of the stock chart when hovering the mouse over a stock ticker.
#2: Google Finance
Google Finance provides free stock screener interface which is very easy to use. The interface also comes with some visual experience. On Google Finance, speed is not at all an issue and the time required to learn to use it properly is very little. One of the aspects that users of this screening service have pointed out is the limited availability of the selection criteria for the purpose of performing stock scans. Technical filters have hardly been included and the fundamental filters available for screening purposes are fairly the standard ones made available by most screening service providers. For quickly accessing a stock’s quote page on Google Finance, users have to just click on results button. This feature is provided by Yahoo Finance as well.
#3: Yahoo Finance
Yahoo Finance is well aware of what investors are looking for. As a result, it is surprising that the stock screener provided by Yahoo! is also very effective. Yahoo makes available a basic HTML screener that can be accessed through the same browser window. However, Yahoo offers some additional technical criteria that are not provided by most of the other screeners. Users can save all screens for use later, export to excel, or even email it someone. All that users have to do is click on the ticker to access the appropriate Yahoo page on Yahoo Finance.
The stock screener provided by Morningstar is a very basic one. Traders have to first create a basic account and then go to stocks, click on tools and then click on stock screener. However, the Morningstar makes up for what it lacks in terms of the availability of fundamental and technical screening criteria through a proprietary rating system that it offers. This free stock screening software enables traders to narrow down to their results with the help of three Morningstar ratings. These ratings are profitability grade, growth grade and financial health grade. Rating from A through F can be allocated to each criterion. Once traders choose the criteria as per their requirement, the results are displayed on a new page. This causes a little bit of inconvenience because users have to go back to criteria page to tweak it and run the program once again to get the results. All said and done, the Morningstar stock screener is basic in terms of functionality, but it does enable investors to make use of several quality criteria that are often reserved by others for premium members.
In this list of five free stock screening service providers, the MarketWatch comes in the last position. This is because it offers a very limited number of fundamental and technical selection criteria when compared with others. However, the stock screener provided by MarketWatch is not only clean, but also very easy to use. Overall, MarketWatch’s screener is a very basic screener, but what is different is the fact that the stock filters provided by it are of very high quality. Traders and investors who are looking for advanced functionality may feel that MarketWatch’s screener is not very useful to them, but they can definitely make use of the interface to carry out multiple stock scans and build a targeted stocks watch list.