Hi, newbie here, just bought couple of books on stock trading technicals,

but the problem is there's no lessons on how to pick and search for stocks,

so here I am... I've found many free stock screeners on the web like yahoo, msn, etc. but I don't know how to set the criterias.

are there any lessons on how to set each criteria and also explain in details what each means or does ?

any help appreciated, thank you.

kate

Well it really depends on what you are interested in, what kind of investor are you. Do you have capital you are willing to risk.  If you lose it, will it have a huge impact on you? (losing money is never what we set up to do, but it is a reality to many new investors)

When I look for a stock I look for a few things. Mainly to see if it is undervalued.  I look for stocks that are in high demand, and right now I am looking for things to buy for the long run, maybe trade along the way.  There are several things that are recession proof, and there are several that are prone to shake ups in the economy. Entertainment/restaurantes/ect people tend cut back on when times are tough.  People are spending more on gas, they may not go out as much ( i sure dont)

So, in picking stocks try to think about the bigger picture.  Pick a sector of the market that You think will be trending up, research it.  I would suggest for your first picks to do a lot of research.. Maybe make a few spread sheets and just watch the stocks you like before using real money.  Pick 100 shares of a company you like and you think will do good, watch it for a week or two. Then you can see if you were right.. and if you were, good.. If not, you didn't lose any money.

many people will suggest investing several thousands when your new in index funds, or something of that nature.  That is good, and carries slightly less risk.. I personally didn't do that, because i felt comfortable with the positions i was picking.. However, fund managers have a lot more information on their picks than most individual people have at hand.

Oh - and for screens.. Just pick things your interested in.  Foreign, Domestic, dividend stock, non div. stock.. PE ratio. And just narrow the field down.. But dont forget to RESEARCH every play.

technicals are really unrelated to stock screening. They are reasearching the movement of the stocks rather than whats the companies news stories. It can be valuable but it is mostly used for short term trading.

screening is tough. but basic things to look it is price to earnings (a measure of stock price to the earnings they report) which is price divided by earnings, the higher the earnings the lower the ratio, the lower the price the lower the ratio. The lower the ratio the lower the value.

PEG ratio is price to earnings divided by the growth rate of the earnings. If earnings are growing quickly the ratio will be lower becasue it's price/(earning*growth rate). A value of 1-1.2 or lower is considered a starting point to see if a company is undervalued.

Debt-to capital compares all the debt of a company to all the assets of the company. It says nothing really of liquidity but it at least give you an idea of how well off the company is. The lower the better in most cases (growing companies usually have high debt)

ROE/ROI return on equity, return on invested capital. both measure the return(profit) divided by sharholders equity and ROI is invested capital. The higher the ROE or ROI the better a company is doing. An example is like a company buying a new machine. If the company gets 30% more from the machine the ROI is 30%(this is really basic but kinda explains it).

Operating margin is the measure of profit a company gets from what it produces or does. This is a good measure to see how much money a company makes off what it does.

There are a lot of things you can screen but here are som main ones people use. You can learn a lot by just looking up what the diffeerent screening options are on a screener, that helps a lot but always think of what the metric misses or may overstate. Debt-to-capital for example may tell you the company has a small amout of debt compared to its assets. But if the company does not have a lot of cash as an asset they may not be able to pay off debt and could face trouble. I advise you not to just dive in becasue you have money. Put some money in an index fund, sector ETF, or Mutual fund until you feel ready. Don't just pour in money cuz you have it. You want to have a good ROI too.