Use an Automatic Filter to Screen Your Investments

by Ron Haynes

Have you used an investment screener? Stock, exchange traded fund, options, covered call, and mutual fund screeners are designed to allow you to determine the unique criteria that match your investment standards and interests. They then search for investment opportunities that fit your personal strategy and leave everything else out. Most online brokers and financial data sites and have screeners to help you filter out the investments that don’t meet your pre-defined criteria or they will only show certain investments that DO meet certain criteria. They’re extremely useful … if you know what you’re looking for. And as I’ll mention later, they can be useful even if you DON’T know exactly what you’re looking for.

What can be filtered through an investment screener?

As a Scottrade customer, I can easily use:

  1. The stock screener
  2. The exchange traded fund (ETF) screener
  3. The mutual fund screener

The Stock Screen

Stock screens can filter investment opportunities by:

  • Market Segment – you can easily search stocks by their sector, which index they’re a member of, various exchange components, international investing opportunities, or market capitalization.
  • Sales and Profitability – set your own minimums (or even maximums) for sales and profitability.
  • Fundamentals – you can also search according to price/earnings ratio, return on sales, inventory, investment, or equity, free cash flow, return on debt, or liquidity ratios.
  • Analyst Estimates – find out what the experts believe and predict for a company’s growth rate.
  • Price Performance – check out the 52-week high and low or a price-to-S&P 500 comparison.
  • Earnings and Dividends – find only those stocks that have the dividend yield you want.
  • Technical Analysis – for those who love the charts.

Ssearch for stocks, options, covered calls, spreads, mutual funds and ETFs based on the factors that you choose with optionsXpress by Charles Schwab.

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For ETFs, you can screen according to:

  • ETF Basics – examine by asset type (equity or fixed-income), classification or fund family, even commission free funds.
  • Performance – check out the fund’s past performance over the last month through the last ten years.
  • Fundamentals- easily apply fundamental indicators to your screen and use that analysis to measure different funds.
  • Morningstar Rating – search funds for rating, risk or return score, or category rank over various time periods.
  • Technicals- use technical indicators to measure a fund’s performance.

For mutual funds, you can screen:

  • Mutual Fund Basics – screen by load type, availability, fees, asset type, classification or fund family.
  • Performance – filter funds based on performance over the last month through the last ten years.
  • Fundamentals- measure funds by the fundamentals. Choose from price to earnings (P/E) ratio, price to book (P/B) ratio, distribution yield, 30-day SEC yield, alpha, beta, Sharpe Ratio, R-Squared and standard deviation.
  • Morningstar Rating – just like ETFs, you can screen funds for rating, risk or return score, or category rank throughout various time periods.

The difficulty with using investment screeners

Here is a snapshot of the Pre-Defined Stock Screen I found tonight on the Scottrade website. As you can see, there are thousands of investments that match the criteria listed.


Far too often, I’ve utilized a screen with too many filters and didn’t find anything. You CAN be too picky! There probably isn’t any investment you can find through a screen that will give you every single thing you want – high returns, outstanding growth, glowing estimates, high cash flow, incredible returns and ratios … and a price that’s about 20% below where it should be. It just doesn’t exist.

What does exist … and is extremely helpful … are pre-defined screens. Scottrade and all the other online brokerages (as well as most financial services sites) have screens pre-loaded and these are easily accessed and used to help you and me make our investment decisions.

My personal favorite is the Strong Growth and Value Stocks (with 109 matches today). Once you select this screen, you can then view the summary page with basic information on these 109 companies, their relative price performance, their earnings and dividends as well as their fundamentals including:

  • PEG ratio (Price/earnings to growth)
  • Profit margin
  • Trailing 12 months P/E ratio
  • Price to sales ratio
  • Price to book ratio
  • Price to cash ratio
  • Return on equity
  • Return on assets
  • Debt to capital

This predefined screen is one of the most helpful in my opinion. It features some companies I’ve heard of (and even own) as well as some that I never knew existed.

Start your Scottrade portfolio today and begin using a stock screener!

So I’d encourage you to check into investment screens. Play around with them and get comfortable using them. See what criteria or yardsticks you can use to get different results. I’ve known some people who used screens to find stocks that were at the top of their 52 week high … and then shorted them! The sky is the limit once you learn to use a screener to filter investments to meet your standards.


About the author

Ron Haynes has written 988 articles on The Wisdom Journal.

The founder and editor of The Wisdom Journal in 2007, Ron has worked in banking, distribution, retail, and upper management for companies ranging in size from small startups to multi-billion dollar corporations. He graduated Suma Cum Laude from a top MBA program and currently is a Human Resources and Management consultant, helping companies know how employees will behave in varying situations and what motivates them to action, assisting firms in identifying top talent, and coaching managers and employees on how to better communicate and make the workplace MUCH more enjoyable. If you'd like help in these areas, contact Ron using the contact form at the top of this page or at 870-761-7881.