Stock Traders: How Do You Find Your Symbols?

[Firm Biz 10]

How do you find your symbols each day to trade? Do you scan for certain criteria you like, constantly monitoring hundreds of stocks to find good setups?

 

Or do you have just a very small number of stocks you stare at and wait for those few stocks to give you an entry?

[UrmaBlume 10]

News is created and then, like trade, it follows the sun around the world. Sometimes such news can cause the trade in certain instruments to exhibit out-of-sequence trade volumes and abnormal local price volatilities. Knowledge of such situations can equal opportunity for the astute investor.

 

At some other times and in the absence of any discernible, relevant news, certain other markets will exhibit these same unusually high trade volumes and local price volatilities. This is another kind of opportunity – one where something is going on, but not as many people know about it.

 

Whether there is news or not – at any point in time, among the thousands of financial instruments traded around the world there is a small subset that exhibits these unusually high relative trade volumes and/or local price volatilities.

 

Through a process we call the serial normalization of market performance data we produce relative values of local trade volumes and local price volatilities so that the performance of symbols can be compared one to the other.

 

A symbol trading at 40% of what is normal volume for that issue may be trading a much higher absolute volume than an issue that is trading at 200% of normal volume and yet not offer the opportunity of the symbol trading at the lower absolute volume but higher relative volume.

 

Below are the results of scanning and sorting 400 stocks for both relative volume and price volatility as well as a sort for the most popular futures and forex pairs. These scans were taken at the close 3 days ago.

 

We are building a scan for all of the liquid equities with direct market acces, world-wide.

 

Information = Equity

 

Trade What's Hot and Not Trade What's Not.

 

 

 

 

[Tradewinds 12]

  Firm Biz said:

How do you find your symbols each day to trade? Do you scan for certain criteria you like, constantly monitoring hundreds of stocks to find good setups?

 

Or do you have just a very small number of stocks you stare at and wait for those few stocks to give you an entry?

 

I would compare potential gain to effort. Scanning has both benefits and detriments. I would ask the questions, "How much effort and resource needs to be employed to get a certain amount of gain? And could you have used that time and effort doing something else?" If you have very good scanning capabilities, good criteria, and can act fast enough, there could be large pay offs.

 

It's probably a matter of personal preference also. I have absolutely no interest in scanning for stocks to trade. There is plenty of opportunity and price movement in many financial instruments that I don't need to go looking for. For me personally, at this stage in my trading journey, it seems like scanning is just not worth the effort.

 

Of course, the decision to scan or not to scan probably has a lot to do with each person's individual interest and what level of trading they are at, personally or professionally.

[SIUYA 11]

Some people I know watch a small basket of instruments. Others look for the hot sector, others stick to 1-2 instruments, others are more systematized and trade a massive basket.

How to do it is the issue - who knows. There is as tradewinds says a trade off between time and effort. Do you wish to have a rough and ready scan and then focus in, do you want to click through and analyse 100 instruments.... it does not take that long each day, but it can become monotonous.

Personally I flick through what seems hot, using long term time frames and alerts, then narrow down. I am working on something better, but its incredibly difficult to get this information in one spot, and I have found just flicking through charts is often quicker.

There is also the other consideration......time frame for trading. If you are scalping, or intraday trading, you only need a few instruments, if its longer term more are required.

[Chippy 10]

I found it much easier to trade Futures and Commodities than stocks. There are a certain amount of markets I can look at and plenty of volatility compared to stocks. Best thing is...they are open 24 hours. Since I moved to futures I wouldn't even think of moving back to stocks, and really have no clue why people choose stocks over commodities. For stocks you have to have at least $25k for the day trade rule, but futures there is no rule. Most brokers require $5k account...but that is about it.

 

With that said, I look the night before at what markets I want to trade the next day based on a set up and set alerts on each market when the price is triggered. Makes it easy to get up whenever I hear the computer going off.

[peterjerome 10]

start with basket of good fundamentals,

look for PnF double-top breakouts.

 

peter

[MadMarketScientist 11]

I've always been a believer in having a hot list of stocks - my basket that I'm going to trade and only focus on those. I'll occasionally update the list or drop some stocks that are no longer responding to my strategies. It happens but some stocks stay on the list for years (Apple, Google, etc...) others come and go more often.

 

The way I build mine? As simple as it comes. I look at the hot lists -- such as top dollar gainers and losers each day. Top percentage gainers and losers. I usually like volumes over 1 MM shares but have been known to waive that rule if it's close or obviously active. Stocks that appear then on these lists consistently tend to be for me anyway the best to trade.

 

I know there's a lot more complex and I'm sure much more highly intellectual ways to do it but you end up with a great list of volatile movers doing it as simple as this - just observe it for a few days, or a week and you'll almost always end with a great list.

 

MMS

[Pi_ 10]

I believe this depends on what and how you are trading .. but for myself volume and price are what i need due to shares and affordability .. it takes very little time to use a stock screener you have already set up and for what I trade i keep most of the same symbols anyway. I will also watch a percentage screener of to the side because no one wants to blatantly miss an opportunity ...