With thousands of companies listed on the financial market, it can be a time-consuming and inefficient task to manually sift through all available data and narrow down the best stocks that are worth your money. With a stock screener, however, you can filter through stock listings in a matter of seconds to find only the stocks that interest you based on certain customizable parameters like stock price, price-to-book value, or moving average levels.

To get the most out of a stock screening tool, it is important to clearly define your money goals and investment preferences. This will help you decide which criteria to screen for and what the purpose of your investment research should be. Here’s our guide on getting started with a stock screener.

How a Stock Screener Works

A stock screener works as a filter to help investors separate stocks that meet certain defined requirements from the vast number of company listings on a stock exchange. A stock screener typically has access to the database of companies publicly listed on national stock exchanges. The tool then provides users with a set of variables that they can adjust to fit their interests and preferences. The screener uses these customized variables to generate a list of matching stocks.

Many performance metrics and financial criteria can be used to screen stocks. Some of the most popular metrics include technical indicators like moving averages or relative strength index, as well as fundamental factors such as P/E ratio, operating cash flow, and ROI. 

While many stock screeners offer hundreds of parameters that can be used to find a very precise class of stocks, some screeners come with predefined screens that use preset variables to evaluate stocks in line with common investment strategies. The latter option is a simpler time-saving option for beginner and retail investors without much trading experience. 

Why is a Stock Screener Important?

The most obvious advantage of using a stock screener is that it can help you save time by filtering out stocks that do not match your investment preferences, so you can focus your time and effort on researching and analyzing a small selection of stocks that fit your trading strategy. However, stock screening can also be a powerful tool for discovering new asset opportunities or judging a potential investment decision.

Asset Discovery

Stock screening allows investors to search for stocks using an organized system. This makes it very effective in revealing overlooked or unfamiliar stocks that could be an excellent fit for your portfolio. These potential investments would be much more difficult to spot if you had to manually screen thousands of available listings.

  Bias Elimination

Behavior bias is the inherent tendency in all investors to make unwise investment decisions due to certain preconceived notions or irrational emotions. A stock screener however relies on quantitative data to evaluate stocks, helping investors stay objective when researching investment opportunities.

Do Stock Screeners Have Limitations?

Stock screeners are only effective in evaluating a stock based on quantitative parameters. They cannot include many other qualitative factors about a company that is critical to its future performance. For example, company information like competitive advantage or management quality is too abstract for a stock screener to measure. To get the most out of a stock screening tool, it is important to understand that it does not replace thorough research and in-depth analysis. The screening process should only be used to identify stocks that are worth giving further evaluation before placing a trade.

Find the Right Assets With Anahit’s Free Stock Screener

Anahit Stock Screener is one of the simplest stock screeners available for free and is designed for beginner and retail investors looking for ready-to-use information about select stocks. The Anahit stock screening tool has access to market listings on various exchanges across countries and offers predefined screens to users allowing them to evaluate stocks based on various preset parameters.

Golden Cross/Death Cross

The first preset filter available on the Anahit Free Stock Screener is the Golden Cross/Death Cross screener.

This screen evaluates listings in a select stock exchange based on moving average levels. The Golden Cross screener shows stocks that are experiencing a bullish breakout with a 50-day moving average crossing above its long-term (200-day) moving average. The Death Cross screener finds stocks that are in the exact opposite situation. These stocks are seeing a bearish trend with a 50-day moving average crossing below their long-term moving average.

Oversold Stocks

The Anahit Stock Screener also comes with a predefined screen for searching oversold stocks.

This screen provides a list of assets for select countries and exchanges that have been oversold and are likely trading below their book value. A stock is considered oversold based on its Relative Strength Index (RSI) which measures its price change momentum on a scale of 0 to 100. When the RSI of a stock falls below 30, it is likely oversold. 

Beyond Stock Screening

Beyond our free stock screener, Anahit offers many more tools that you can use to improve your investment research. Anahit is an asset analysis platform that uses unique AI algorithms to monitor and update users on select assets across five dimensions: fundamental, technical, macro social sentiment, and news.

Get started for free with the Anahit Stock Screener today. Sign up today at Anahit.ai.