We now live in the information age where corporate information is available 24/7.
The sheer quantity of financial information is staggering, making it impossible for any individual to absorb.
There are hundreds of publications and media that focus exclusively on financial information.
The financial institutions also have entire departments that focus solely offering research and analysis.
The internet is open for 24 hrs to access financial statements,SEC filings,opinions from all angles, on every listed company on the major exchanges.
Anyone looking for financial information can find it.
Sorting good information from bad is difficult as you the information may also be conflicting.
Before the advent of the information age, most individual investors would get their investment ideas from three likely sources.
Recommendations from a broker.
Read or hear media reports about positive developments about a company.
Personal experience with the products or services of a particular company.
Over time these strategies have proven to be unreliable as there is no follow-up or exit strategy involved and there is no management processes involved.
Buying stocks online improves the chances of profitable investing when programs are implemented.
Stock screening is the process of finding stock that meet meet certain selected criteria.
eg.
You may wish to invest only in equities with a market capitalization over ten billion that are traded on U.
S.
exchanges, a forward price/earnings ratio below twelve and dividend yield of 4.
5 percent.
As more criteria is selected the results is more refined and selective.
Screening is only the beginning, and the analysis provided should undergo further scrutiny and judgment.
Screening is used in many other non-investment related industries in attempts to isolate or focus events or objects.
Screening may not always produce a 100% success rates as the possibility of false positives or negatives is always present.
The process of screening, does however reduce a large universe of possibilities into a much smaller and manageable universe.
Screening was available to professional portfolio managers with large resources.
Computer power and memory were at a premium, however with the growth of the internet and increased data storage capacity at now minimal costs, along with the widespread use of computers, high level screening is available to everyone.
Before using a screen as an early step in online stock investing,investors interested in buying stock, should be aware of what can be achieved.
There are a few stock screening programs that will actually denote the particular stock as a buy, sell or hold, but the ultimate decision is still with you, the investor.
If All automated trading systems were that efficient, then everyone would be rich.
Screening can help you become a better investor by establishing more discipline in the investing process with a consistent approach, and being more objective.
Investing in the stock market is not rocket science.
The resources are available for everyone to educate themselves and develop your own investment ideas.
A stock that might be suitable for someone else may not be suitable for you.
Your screening process should help you in developing your own investment style in addition to generating your own investment ideas.