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Understanding Stock Screeners - Practical stock screening

Screening for stocks is all about applying quantitative criteria to a broad universe of stocks to narrow the list down to a few companies - focusing attention on a smaller, but more promising group of stocks. You may have some ideas of your own, but it won't hurt to revise on the basics - know what criteria to use, and how?

1. You need to define for yourself very clearly the Objective of your hunt. Exactly what kind of stocks are you looking for?
2. A clearly defined objective, will lead you on to the Primary Screening criteria.
3. Next, you want to make sure that the stocks that pass the primary filters are not there because of some coincidence; they are there because they truly deserve to be. So, in effect you are looking to eliminate the duds/misfits from creeping in. Secondary or Conditioning criteria need to be applied for that.
4. Browsing through the Guru stock screens may help you quickly understand how one can clearly define narrow objectives for your screen, and set primary and secondary screening criteria.

ValuePickr Stock Screener - how does it work?

If you have browsed through the Guru stock screens and followed the links to see a typical stock screener selection, you would have seen how a stock screener is nothing but a sequential application of filters or queries against the database of stocks. ValuePickr currently maintains data for just over 3,000 actively traded stocks in the Indian stock markets.

1. A step comprises of an Expression that specifies the criteria used to query the database. You can also use more than 1 expression in a step with "and", "or" in between.
   
2. The first step queries against the all-stocks universe (ValuePickr stocks database) by default. If you so wish, you can also set the universe to a specific sector, industry or say an Index
3. Each step works on the filtered base of stocks output by the immediately preceding step and returns the stocks that match the criteria specified. 
4. For the end result (output from the last step), the ordering or sequence of steps does not matter. Think of it like an AND operation between all steps. 
5. The number of matched stocks (Count) at each step is indicated for easy reference. One can easily see how "restrictive" or "loose" a filter criteria is, and decide about tightening/relaxing accordingly. You can also move an expression up or down the order to see the effect of the criteria on number of passing companies. 
6. The list of matched companies is produced. Pertinent data (variables used in each step) is displayed. Click on any variable header to "sort" the list of passing companies on that variable. You can also download the results to a .csv file.
7. You now have a shortlist of promising stocks matching your objective. Click on a company name to investigate the company's fundamental data, growth, financial strength, and valuation snapshots, in detail.