Predefined Stock ScreensDownload printable PDF
After installing Stock Investor Pro for the first time, many new users of the program are unsure of where to begin. One of the most popular features of the software is its collection of over 60 preinstalled stock screens, many of which are based upon the screening principles of well-known investors such as Warren Buffett, William O’Neil and Martin Zweig. Other screens are tied to basic principles of investing, such as the low price-to-sales ratio. This installment of Stock Investor News shows new and existing users how these predefined screens work and offers additional resources and tips for getting the most out of AAII’s screen collection.
Basis for the Screens
Many of the stock screens that are built into Stock Investor Pro are based upon the selection methodologies of prominent investors. In developing these screens, we typically rely on books either written by the investor, such as William O’Neil or Martin Zweig, or written about the investing style of the individual, as is the case for the Warren Buffett screens.
When translating a strategy into a screen, no matter what platform is used, compromise is inevitable. You are limited by the data and functions that are available with the program. For example, if an approach calls for earnings analysis over the last 10 years, we have to scale back the criterion in our screen to accommodate the seven years of data available in Stock Investor Pro. There is some flexibility when it comes to adding custom fields that are not in our program, but we are ultimately limited by the depth of the data to which we have access.
The final result is a screen that best captures the spirit of an approach given the capabilities of our software. The originator of the approach is not involved in the development of the screen, nor does our screening result necessarily match the stocks the particular professional recommends or invests in. However, though the screens are AAII’s interpretation of the investment approaches, we hope to closely capture each investment methodology’s rationale.
Running Predefined Screens
One of the most frequently asked questions among Stock Investor Pro subscribers is how to run the preprogrammed screens. There are two ways to run the screens within the software—from the Screens pull-down menu and from within the Screen Editor.
If you know which screen you want to run, you can select it from the Screen pull-down menu found at the top of the program window. Screen names preceded by an asterisk (*) are the screens that come pre-installed with the software. (Note: If there are no screen names with asterisks in the pull-down menu, you did not load the AAII predefined data when you installed the program. Exit the program, open Stock Investor Utilities and choose the “Load predefined data” option.) Choosing a screen from the pull-down menu will automatically run the screen against the active set of companies and load the passing companies (results of the screen) in the Stock Notebook.
You can also load predefined screens through the Screen Editor. There are several ways to open the Screen Editor: by selecting it from the Tools menu, by clicking on the funnel icon from the Toolbar, and by using the Alt+S key combination. Any of these methods take you to the Screen Editor.
Once at the Screen Editor, select a screen from the pull-down menu at the top of the window (the Name field). Clicking on one of the screens listed will load the criteria of the screen in the Screen Editor. For example, selecting the *Buffett (Hagstrom) screen loads Hagstrom’s Buffett criteria automatically into the Screen Editor. From here you have the option to alter the screen and save your revised screen under a different name.
Within the Screen Editor, there are two ways to “run” a screen: using the How Many and Apply buttons at the bottom right-hand side of the Screen Editor window. If you would like to know how many companies pass a screen, but do not wish the results to be loaded into the Stock Notebook, click on the How Many button. At this point, the full database of 7,229 companies (as of November 22, 2013) still comprises the active Stock Notebook. If you closed the Screen Editor, the companies you would see in the Stock Notebook would not be the results of the screen on which you ran the How Many function.
In order to run a screen and have the results (the passing companies) loaded into the Stock Notebook for viewing and additional analysis, you must click the Apply button. Applying Hagstrom’s Buffett approach to the universe of active stocks as of November 22, 2013, loads 24 *Buffett (Hagstrom) passing companies into the Stock Notebook.
Learning More About the Approaches
It is always important to understand a particular investment approach before you devote your money to it, and the predefined stock screens represent an excellent educational resource. Within Stock Investor Pro’s Help System, we have compiled a list of screening articles. To access these articles, select Contents and Index from the Help menu at the top of the program window. From the Contents tab, double-click on Pre-Defined Stock Screening Strategies. This will expand the topic category to show the names of all of the preprogrammed stock screens. Clicking on a name will open the overview article for an approach.