As of April, 2006, nearly 2,800 stocks were being traded on the New York Stock Exchange. NASDAQ lists over 3,000 stocks, and the American Stock Exchange trades another 1,300 or so. In addition, there are over 8,000 mutual funds out there. With so many securities from which to choose, how do individual investors find the ones that have investment potential and that meet their particular goals?

Family, friends, and financial news can provide great leads. Usually, however, by the time a stock is being talked about and featured, you, and a few thousand other investors, are taking a close look at what it has to offer. Fortunately, technology has made finding companies in which to invest much easier. Stock screeners, available for free on many web sites, make it very easy to find stocks and mutual funds that meet your needs.

Typically, for a stock you are able to select specific values for at least these criteria: industry, share price, market cap, dividend, sales, profit margin, and EPS. Mutual fund screeners, which are increasingly valuable as the number of mutual funds continues to grow, allow you to set criteria for category ("domestic equity" for example), style (cap size, growth or value, etc.), sales growth, EPS growth, manager tenure, expense ratio, load, minimum purchase, and more.

In addition to making the number of stocks to consider more manageable, stock screeners offer these advantages:

You can refine your search according to specific criteria, concentrating your research on only those companies.

You are forced to think about the criteria you want to set, such as cap size, industry, a specific PE, etc.

The companies that come up on your search are included because they meet the objective measures you selected, not because someone, perhaps someone with interests different than your own, recommends a stock.

"Undiscovered" companies may be brought to your attention.
Many web sites that offer financial information also offer stock screeners. Check the most well-known financial sites until you find a screener with which you're comfortable.