A guide to practical tools to help you invest efficiently

Views 11K May 20, 2024

Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker!

As we all know, the first step to success in investing in stocks is stock selection.

If you ask chatgpt how to invest in the current economic environment, chatgpt will tell you that defensive stocks such as consumer necessities and health industries tend to perform better during the recession, as well as suggest investing in gold and mining-related stocks.

But how from nearly a million stocks, the precise selection of stocks that have the potential to “make money” at the moment?

Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker! -1

Maybe textbooks will tell you, first find consumer, medical, gold, all these industries stocks, and then start from the technical side, fundamentals, look at financial indicators, K-line trend, but also to count the recent market situation, etc., and finally compare, it looks like a time-consuming and energetic hard work Live.

But if there is a tool, you can set the criteria, filter out a bunch of eligible stocks in a second, and quickly find a good company to “make money” according to the indicators you pay attention to!

This tool is a stock picker.

With this tool, it can:

Help you step faster, when the market situation changes, quickly tap into line with the current logic to make money stocks;

It also allows you to copy the logic of certain investment opportunities and find the next “gold mine” in advance!

It can even help you filter certain characteristics of stocks to find investment opportunities in options and futures derivatives.

Learn how to use a stock picker.

First, how to use the stock picker to dig, excellent performance or have short-term advantages of “gold” stocks?

The stock picker, as the name implies, is based on the investor's own stock selection strategy, setting conditions and filtering out eligible stock pools.

Generally speaking, stock selection methods are broadly divided into two categories:

① It is a stock that finds good operating conditions and has long-term investment value based on financial indicators. For example, value investors combine indicators such as net profit, cash flow, ROE, etc. in financial indicators to determine the company's operating performance for stock options;

② It is a stock that finds short-term profit opportunities based on technical indicators and patterns. For example, technical analysis teams use common indicators such as KDJ, MACD, MA to find patterns of low forks, multi-head arrays, etc., to determine if there are any investment opportunities to filter stocks over a short period of time.

So no matter which selection method we use, provided that we develop our stock picking strategy → and then according to the strategy, find the appropriate conditions → re-use the stock picker to screen out the stock pool.

We follow chatgpt's advice to find investable stocks in the gold industry as an example, and follow these steps:

1. find the stock picker

When you want to choose stocks, you can click on Search, click to enter a stock picker in the top right corner, or click Market on the Home page, and in the opportunity, click the stock picker to enter.

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Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker! -3

2. create a stock selection strategy:

Then you can click “Create Stock Option Strategy” to combine and filter stocks according to market, stock indicators, financial indicators, technical indicators, 4 broad categories of 100 factors (conditions).

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For example, US stock gold industry stocks, you can click on the US stocks in the region, click on the industry sector, find gold by letter, you can display the filter out of 47 stocks, and can be sorted according to the stock price, rise and fall priority.

Then you can click “Save” to leave this stock selection strategy and keep track of daily updates to the stock pool. You can also select the stocks you want to focus on to add to the selected list by clicking Add Selections in the “Stock Selection Results” section.

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Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker! -6

3. improve the stock selection strategy to narrow the scope:

If you also want to find gold stocks that can be invested over the long term, with stable profitability, growth and good performance, you can choose to increase the ROE≥ 10% in the financial indicator “ROE” (ROE is a measure of the performance of the enterprise, the higher the ROE, the higher the ROE, represents the stock (The higher the ticket yield may be), further narrowing the scope, filtering out 7 criteria.

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Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker! -8

At this point, you can choose which stocks you are familiar with, or rank 4 stocks with ROE greater than 15% (in Buffett's stock selection strategy, an ROE greater than 15% indicates that the company is doing well, the higher the ROE, the higher the stock's long-term return).

Similarly, after filtering the US equity gold sector to find a short-term investment opportunity, you can choose to increase the low cross bar in the technical indicator KDJ (which indicates that a stock may show a buy signal) to find 1 stock that is likely to show an uptrend in the short-term future.

Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker! -9
Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker! -10
Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker! -11

4. further screening to find the target of investment

Then each stock goes to the quote page, click Analyze to further view the company valuation, institutional shareholder analyst ratings, target price prediction 4 information in the fundamental information to determine whether the current stock's valuation is reasonable and whether it can be bought.

Or look at the analysis and interpretation of short sales data in financial and technical indicators to determine if there are investment opportunities in the near term and decide whether to invest.

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Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker! -13
Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker! -14

Seeing this, perhaps you will find that a stock picker is a tool that will help us omit the statistical process based on the conditions in our stock picking strategy, giving results in one click, want to find the investment target, so we have to have a clear strategy before using a stock picker.

The criteria in the stock selection strategy are derived fromFinancial Report Analysis,Methods of technical analysis,Valuation Methodology, you can click on the blue word to learn in class.

That is to say, when you have a clear strategy for stock picking, you can quickly lock in the treasure of mining gold with this “excavator” of the stock picker.

Second, the novice Xiao Bai does not understand the stock selection strategy, can also use the stock picker?

In the process of using an opter, Xiaobai often believes that there is a high threshold for using an opter because he does not have a well-established selection strategy and is not familiar with more than 100 selection factors.

Then, using these tips, White can easily use the stock picker.

Tip 1: Use the default 8 stock selection strategies.

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In moomoo/Futubull APP, for new users with little white hands, a good understanding of the US 8 stocks has been set in the right way of the selector, left and right sliding, divided into low-position gold fork-multihead growth, high-profit growth, high-yield, low-valuation, Greem options and CANLIM rules The Buffett strategy, which includes technical analysis as the main stock strategy, the short-term opportunity strategy has the financial analysis as the main stock selection strategy, while the preferred company has a master stock selection strategy. We analyzed 4 strategies for low-grade metal fork growth, high-yield growth, low-growth, and Babafite strategies.

Low Fork Multihead Growth: The condition is that the share price is greater than 1 and the market capitalization is greater than $0.1 billion, the Daily K-line MA presents a multi-head arrangement, the MACD represents a low cross, and the Annual Report Operating Cash Flow Synchronized Growth Rate is greater than 10%. Screened out are stocks of companies that may be on an uptrend in the short term from a technical analysis perspective, and from financial indicators, strong cash flow, business growth potential, and no downside risk at present.

High Profit High Growth: The condition is that the share price is greater than 1 and the market value is greater than USD 0.1 million, the annual reported net profit is approximately 30%, the annual operating profit is approximately 30%, and the operating cash flow per share is greater than 30%. The filter is that there are high operating profits, strong profit and cash flow growth, and there is currently no risk of a sell-off.

Growth with low leverage: The condition is that the share price is greater than 1 and the market capitalization is greater than $0.1 billion, the annual operating profit and loss ratio is approximately 30%, the annual operating cash flow per share is greater than 30%, and the annual balance sheet is less than 20%. The filter is a group of stocks of companies that are currently high growth, low debt and low risk, and currently have no downside risk, from financial indicators.

BUFFETT STRATEGY: THE CONDITION IS THAT THE SHARE PRICE IS GREATER THAN 1 AND THE MARKET CAPITALIZATION IS GREATER THAN $1 BILLION, THE CIRCULATING MARKET VALUE IS GREATER THAN $5 BILLION, THE ANNUAL GROSS MARGIN IS GREATER THAN 30%, THE NET PROFIT GROWTH RATE IS GREATER THAN 6%, THE ROE IS GREATER THAN 10%, AND THE OPERATING PROFIT RATIO IS GREATER THAN 70%. This is a stock selection strategy developed according to Buffett's famous roe selection method, which filters out a batch of company stocks with continued growth, high operating profits, and higher industry moors.

Little White can choose a strategy based on the type of company you want to invest in and click to see the corresponding stock pool. Then in the lower left corner of Modify Indicators, go on to add the adjustment criteria such as “Blocks”, Technical Indicators, Financial Indicators, Characteristic Indicators, and more to further filter the stock pool.

Tip 2: Check the meaning of a factor.

If you do not know the meaning of some indicators, after entering the stock picker, you can click on the informati in the upper left corner to see the specific meaning of each indicator.

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Stock picker: how to discover the next “gold mine” one step earlier? Try stock picker! -17

Here, Finance School also lists several common factors that can be of concern

Determining valuation: market earnings (in general, the lower the market earnings, the lower the valuation), the lower the market rate (in general, the lower the market net rate, the lower the current valuation), the market sales rate (in general, the lower the market sales rate, the greater the investment value)

FINANCIAL INDICATORS: OPERATING PROFIT IN PROFITABILITY (WHICH REPRESENTS WHAT THE COMPANY ACTUALLY MAKES MONEY, THE HIGHER THE BETTER), OPERATING PROFIT TO GROWTH RATE (THE HIGHER THE HIGHER THE GROWTH OF THE COMPANY) THE RATIO OF OPERATING CASH INCOME IN CASH FLOW (THE HIGHER REPRESENTS THE BETTER THE ABILITY TO TURN INCOME), ETC.

Technical Indicators: The multi-head arrangement in MA, the low cross in KDJ, RSI, MACD, the bottom-back equator factor represents the positive signal; the flat head arrangement in the MA, the high dead fork in KDJ, RSI, MACD, the top-back etc., represents the negative signal.

Third, the advanced “copy” investment opportunity stock selection strategy, find the next “gold mine” in advance!

Having said that, when we have a clear selection strategy, we can filter out the pool of eligible stocks using the factors in the stock instrument. So if we don't have a clear stock option strategy, how do we use an option to find stocks that have an investment advantage in the short term?

Consider disassembling an option strategy based on a known investment opportunity to find a pool of stocks with the same characteristics as this investment opportunity.

For example, after an investor found that stock X had fallen to a recent low since March 23, 2023, it had risen for four consecutive trading days, and was generally bullish for almost 12 trading days, which saw 23 days as an innovative low, followed by a cataclysmic rebound.

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Therefore, based on the characteristics of this stock X and the pattern of the K-line movement, its analysis summarizes the “Innovative Low Bounce” stock selection strategy:

US stock market, the market capitalization is greater than or equal to $500 million, the P/E ratio between 0-50, the average amplitude of nearly ten days is greater than 5%, the ten-day conversion rate is greater than 2%, the stock price is nearly 20 days of innovation low, while MACD day K-line showing deviations.

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According to this strategy, to follow the replicate of similar stock X, stock volatility, large trading volume, recent share price low, short-term investment opportunities may be bottomed out.

Then continue to track the results of the strategy's stock selection, combine capital, technology, and news to analyze stocks, make short-term transactions and explore potential investment opportunities.

Therefore, after analyzing the characteristics of stocks in past investment opportunities, we can analyze the characteristics of stocks in the summary case and develop stock selection strategies, such as increased volatility in the above scenario, larger swap rates, recent price highs, and MACD showing bottoming conditions, to find a pool of stocks that track similar characteristics. Exploit potential investment opportunities.

Four, the use of 4 tips for picking

1. Less extreme and less mutually exclusive: Do not set extreme conditions too much, or use factors of mutually exclusive relationships in one strategy at the same time. For example, both high growth and high profits and extremely low valuation.

2. Precision after screening: In the process of starting to use the picker, it is recommended to set some factors at a minimum, and then gradually increase the condition narrowing range according to the results, which helps to increase the success rate.

3. MULTI-FACTOR INTERSECTION: MULTIPLE FACTOR CONDITIONS, INTERSECTION SETS, MULTIPLE CUSTOM CONDITIONS UNDER ONE FACTOR, INTERSECTION SET.

4. FILTERABLE STOCKS WITH DERIVATIVE ATTRIBUTES: YOU CAN FIND PREMIUM OPTIONS IN THE PC SEGMENT SELECTOR, SELECT “OTHER FACTORS”, CHECK OPTIONS/FUTURES RELATED STOCKS. YOU CAN FILTER THE CRITERIA FOR INVESTMENT OPPORTUNITIES WITH OPTIONS/FUTURES ACCORDING TO CERTAIN CHARACTERISTICS OF THE POSITIVE STOCK.

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Disclaimer: The above content does not constitute any act of financial product marketing, investment offer, or financial advice. Before making any investment decision, investors should consider the risk factors related to investment products based on their own circumstances and consult professional investment advisors where necessary.

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