The Advantages of Using a Stock Screener
Advanced Forex Education

The Advantages of Using a Stock Screener

The stock market can literally be a goldmine but that will only happen if you know your way around when it comes to picking stocks. This is mostly because there are numerous stocks listed on the stock market and that can leave you overwhelmed and confused.

Did you know that there are tools you can use to hasten and streamline the stock-picking process for you? One such tool is a stock screener and we are going to look at some of the reasons why you may want to use one instead of picking stocks the old-fashioned way.

What Is It?

Essentially, a stock screener is a tool designed to facilitate the process of filtering stocks from a myriad of available ones within a short time. The best part about stock screeners is that they pick stocks based on defined search parameters.

For instance, you can use revenue growth as your search parameter to help you fish out stocks that have the potential to grow.

Another thing about a stock screener is that it can help you discover stocks that you didn’t even know existed.

Benefits of Using a Stock Screener

Here are some of the benefits you stand to gain by using a stock screener.


Think about the amount of time it would take you to screen all the stocks in the stock market. It would be cumbersome to say the least seeing as you will need to go through each company’s financial status, past performance, as well as predict their growth among other things.

You also want to keep in mind that doing this will take up much of your time. If you don’t fancy that, a stock screener will come in handy when it comes to saving you time and effort.

That is because the tool helps you find stocks within a matter of seconds based on your investment goals. Once you set your metrics, the stock screener will eliminate stocks that do not match your requirements and find those that do.

Eliminates Behavioral Bias

It is common for investors to make decisions influenced by their emotions – after all, they are human. However, this often leads to wrong investment decisions which can adversely affect their finances.

For instance, you may find yourself buying stocks from a company just because you use and like their products. Now, liking their products is one thing and getting attractive returns by being a shareholder in the company is a different ballgame altogether.

Using a stock screener eliminates that kind of bias so that you do not end up making the wrong investments.

Helps Discover Investment Opportunities

Usually, investors will miss out on promising stocks because they don’t know about them in the first place. This is particularly true when it comes to new investors.

One of the main benefits of using a stock screener is that it helps identify hidden investment opportunities that could generate attractive returns.

You see, a stock screening database has thousands of stocks and can therefore unearth stocks that you didn’t know even existed. Often, underrepresented stocks are disregarded in the market and this presents shrewd investors with the opportunity to gain from such hidden gems.

Keeps You Updated on Existing Stocks

Being an investor is not just about picking the right stocks as you also need to be efficient and updated regarding your stocks.

With a stock screener, you get access to all the information about the stocks you are eyeing and how they are performing in the stock market.

Most stocks feature live price charts that you can follow and use to predict how they are likely to perform in the future.

This allows you to make a decision based on what you have observed.

In Summary

Most people are afraid to get into the stock market because of the work and risks associated with it but it doesn’t have to be that way. If you have made up your mind to venture into the stock market, then using stock screener software is one of the best decisions you can make.

That said, you want to ensure that the stock screener you pick gathers accurate data from reliable sources otherwise you will be setting yourself up for failure.