How to Find Stocks: Scanning the Universe of Stocks in 60 Seconds (2024)

Too many indicators can often lead to indecision and antacids. But there’s a simpler and more logical approach to find stocks for further stock analysis, to identify potential trades, and plot clear charts with minimal indicators to help anticipate what a stock might do next.

Step 1: Scan the Universe

Take a look at Stock Hacker on the Scan tab of the TDAmeritrade thinkorswimtrading platform (see figure 1). Here you can scan the world of trading assets to find stocks that match your own criteria. And with a wide variety of stock analysis filters at your disposal, you can immediately pull up a list of stocks that fit your preferred parameters. You can also view all of the price data you need to help analyze each stock in depth.

Here’s how to do it.

FIGURE 1: LEGAL HACKING.Scanning for trades with Stock Hacker is as simple as choosing the list, setting your parameters, and sorting how you want the results displayed. Image source: thethinkorswimplatform from TDAmeritrade.For illustrative purposes only. Past performance does not guarantee future results.

1—To get started with your thinkorswim scan, choose the subset of stocks you'd like to scan from the drop-down list next to the words Scan in. Here, you can see predefined categories as well as all your personal watchlists and Global Industry Classification Standard (GICS) lists.

2—If you only want to find stocks with listed options, selectCategory, which is the first item on the menu, and selectAll Optionable(see figure 2).

FIGURE 2: SELECTING ALL OPTIONABLE.Under the Scan tab, click Category > All Optionable to narrow your choice set to stocks with listed options.Image source: thethinkorswimplatform from TDAmeritrade.For illustrative purposes only. Past performance does not guarantee future results.

3—SelectAdd Condition Group(to the right of the Setup Scan row). SelectAll of the following, None of the following, or Any of the following.

4—From the +Add filters button, select the filter type from the drop-down list for the above three categories. As an example, let’s add three filters for the All of the following category.

5—For the first filter, selectStock from the +Add filter drop-down list. Then selectLastfrom the stock drop-down list and enter a minimum and maximum price. Add another stock filter,selectVolumefrom the menu, and specify the minimum and max volume. For the third filter, select Study and from the corresponding drop-down list, selectADXCrossover and your parameters.The default inputs for this filter are ADX crosses above 20 with an input length of 14,which we’ll keep.

6—In theSorted bymenu, there are several choices for how you want to sort your scan results. You can stick to the default and sort by symbol. If you don’t find what you need in the prebuilt drop-down list, you can even create a custom quote formula.

7—In the next menu, to the right, selectAscending, then Scan.

The results will appear at the bottom of the screen like orderly soldiers. If you’re not happy with them, you can always edit the filters.

Step 2: Master the Universe

Okay, maybe not the actual universe, but you can attempt to determine where the stocks in your world might be going by charting them in thinkorswim Charts. Just select any symbol in the scan results, selectMore info on [...], thenTOS Charts.

If you’ve never charted, you should try to answer three basic questions:

1. What’s the trend?
2. How strong is the trend?
3. Where do I want to get in?

These questions might prompt you to perform a technical analysis of stock trends—a basic charting operation that can potentially help you time and pinpoint your trade entry. To help us with these questions, we’ll add three studies and make a couple of minor adjustments to the parameters:

• Simple moving average
• Volume
• Relative Strength Index (RSI)

Your chart’s default time frame should be set to a one-year daily chart (1Y:1D). If you need to make adjustments, selectStyleonthe upper-right corner of your chart, selectTime frame setup, and then input your preferred time frame.

Then, from theStudiesmenu (also in the upper-right corner), addSimpleMovingAvgby following this sequence:

• SelectStudies>Add Study>Moving Averages>SimpleMovingAvg.
• Next, change the parameters to 50 by selecting the SimpleMovingAvg line itself.
• SelectEdit study SimpleMovingAvg.
• In the parameters window, change the length to 50.

Volume is a default indicator, so there’s no need to add it. However, if your volume isn’t displayed, you can add it within the Settings menu.

To add theRSI, selectStudies>Add Study>Momentum Studies>M-S>RSI (see figure 3).

FIGURE 3: CHART THE TRADE.Once you find a stock in Stock Hacker, select it, then select TOS Chart. Then answer the three questions below.Image source: thethinkorswimplatform from TDAmeritrade.For illustrative purposes only. Past performance does not guarantee future results.

Once you’ve got thinkorswim Charts set up, you can answer these three questions:

One:Is the stock clearly trading above the simple moving average (blue line in chart) or has it recently crossed above the line?

Two:Has the indicator line in the RSI crossed from below the 30 line to above the 70 line recently?

Three:Is the volume increasing or higher than normal (bars are higher than prior bars, indicating more traders committing to the trade)?

Remember thattechnicalanalysis of stocks can provide visual data to complement yourfundamentalstock outlook. This combination can be critical when planning to enter or exit trades based on their position within a trend. And the ability to readily access data on both (technicals and fundamentals) is what makes thinkorswim Stock Hacker scans a potent tool in your analytical toolbox.

Please keep in mind that past performance is no guarantee of future performance, and there’s no guarantee that any trend will continue in the future.

Although these principles are the foundation of technical analysis, other approaches, including fundamental analysis, may assert very different views.