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In this question, stock screeners are mentioned. What is that? (Here is where you get to see my true lack of knowledge regarding investing.) |
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That's a great question. I'll define it by saying what it does: A stock screener allows you to take all of the stocks out there, and throw away all of the ones that don't meet specific criteria. Let's say I wanted to look only at companies that had a market capitalization of $500 million or more, with an annual dividend yield of 5% or more and a price-to-earnings ratio of 10 or less. I don't want to look at the financial statements for all of the companies out there, because it would take forever. Here's how I would use a stock screener to find that information.
The stock screener "screened out" the 99% of the stocks that didn't meet my criteria. Now, I can roll up my sleeves and dig into the companies that did meet my criteria. It's a huge time-saver. Awesome. I am going to have stocks someday. And I'm going to understand them first.
(Dec 17 '09 at 05:49)
Frugallawyer
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