Getting Started Building a Trading Career Tools and Resources Glossary - Backtesting
- Backtesting Depth
- Bear Market
- Bull Market
- Candlestick
- Charting
- Chart Patterns
- Day Trading
- Dividend Yield
- ETF
- Fundamental Analysis
- Leverage
- Limit Order
- Index Fund
- Margin Trading
- Market Capitalization
- Mutual Fund
- Market Trends
- Moving Averages
- Price-to-Earnings Ratio (P/E Ratio)
- Portfolio Diversification
- Positions in Prosperse
- Risk Management
- Scalping
- Short Selling
- Stock Alerts
- Stock Scanning
- Stock Screener
- Stop-Loss Order
- Support and Resistance
- Swing Trading
- Take Profit
- Technical Analysis
- Trend Lines
- Volatility
Glossary - Stock Scanning
Stock Scanning definition
A process of filtering stocks based on specific criteria to identify potential trading opportunities.Stock scanning is the process of using software tools to automatically search and filter stocks based on specific criteria. This method helps traders and investors quickly identify potential investment opportunities that meet their predefined parameters, such as price, volume, technical indicators, or fundamental data.
Use Cases
Traders use stock scanners to filter through thousands of stocks in real-time and identify those that match their trading strategy. For instance, a trader might set a scanner to search for stocks that are breaking out above their 50-day moving average with a significant increase in volume. This allows the trader to focus on a smaller list of stocks that have the potential for substantial price movements.
Stock scanning can also be used to monitor specific sectors, industries, or stock exchanges, enabling traders to stay informed about market trends and opportunities as they develop.
Historical Context
Stock scanning tools have become increasingly sophisticated over the years. What started as basic filters in the early days of electronic trading has evolved into advanced algorithms capable of scanning the entire market in seconds. Today, stock scanners are an essential tool for both day traders and long-term investors, offering real-time data and customizable filters that cater to various trading strategies.
Prosperse offers advanced stock scanning tools that allow users to create custom scans, save them, and receive alerts when stocks meet their criteria. These tools help investors stay ahead in the fast-moving markets by providing timely and actionable insights.
Visual Aid
Below is an example of a stock scanning tool in Prosperse, showing a real-time scan for stocks breaking out above their moving averages.
Stock scanning tool in Prosperse, displaying stocks that meet specific breakout criteria.
This tool allows traders to quickly identify stocks with high potential, saving time and effort by automating the scanning process.
Related Terms:
- Stock Screener: A tool that allows you to filter stocks based on specific criteria.
- Technical Analysis: An analysis method that uses past price data and volume to predict future price movements.
Frequently Asked Questions
What is stock scanning?
Stock scanning is the process of using software tools to automatically search and filter stocks based on specific criteria, helping traders identify potential investment opportunities quickly.
How does stock scanning work?
Stock scanning works by setting predefined criteria, such as price movements, volume, technical indicators, or fundamental data. The scanner then filters through thousands of stocks in real-time to identify those that meet the criteria.
Why is stock scanning important?
Stock scanning is important because it saves time and effort for traders and investors by automating the process of identifying potential trading opportunities. It allows them to focus on a smaller list of stocks that meet their specific trading strategies.
What are some common criteria used in stock scanning?
Common criteria used in stock scanning include price breakouts, volume surges, moving average crossovers, RSI levels, and fundamental metrics like P/E ratio or dividend yield. These filters help traders find stocks that are likely to experience significant price movements.
Can beginners use stock scanning tools?
Yes, beginners can use stock scanning tools. Many platforms, including Prosperse, offer user-friendly interfaces that allow users to create and customize scans without needing advanced technical knowledge.
How do I set up a stock scan in Prosperse?
In Prosperse, you can set up a stock scan by selecting your desired criteria from a list of filters, such as technical indicators or fundamental metrics. Once set, the scanner will continuously monitor the market and alert you when a stock meets your criteria.
What are the limitations of stock scanning?
While stock scanning is a powerful tool, it has limitations. It relies on predefined criteria and may miss opportunities that don't fit within those parameters. Additionally, the results should always be reviewed and analyzed further before making trading decisions.
Can I save my stock scans for future use?
Yes, in Prosperse, you can save your custom stock scans for future use. This allows you to quickly reapply your filters and monitor the market without having to set up the scans from scratch each time.
