There are many different factors you can use to select the stocks you choose to invest in. There are also many different tools you can use to screen out stocks that don’t meet your criteria. For the purpose of this article, I am going to use the screener available for free at USA Today. You can work along with me by opening up a new tab and entering this web address: http://markets.usatoday.com/custom/usatoday-com/screener/screener.asp. This is one of my favorite tools, because 1) it’s free and more importantly 2) it allows you to enter in many different factors.

To start off, the main categories of screening are listed on the left side of the page. They are price, volume, fundamentals, technicals and ‘exchange and industry.’ You can use any or all of the factors for your screening process.

Under the price function you can enter a range of prices you are interested in, for instance between 12 and 15 dollars. And then you can look at ones that have risen or fallen a percentage during the day, hour, 15 minute or five minute period. You can also enter if it is trading above or below the 52 week high or low. So just using two of those parameters, if we search for a twelve to fifteen dollar stock that has risen 1% in the past day; press the next button and then choose how you want to view the results. Default settings have been selected already, so you can just push the “show stocks” button and look at what is available. On the day I did this I got 119 different stocks that fit that range.

You can then go back and check out the next area for screening I recommend, which is the fundamentals section. If you use the back arrow function on your browser, you will not lose the criteria selected. The two available tools in fundamentals are the price to earnings ratio (Abbreviated P/E) and the market capitalization. For the sake of discussion, I will enter a P/E of 5 to 10, and a market cap between 100 and 500 million. Press the “next” button and then the “show stocks.” On this particular day that brought the number of stocks that fit the criteria down to one.

By using the tools already discussed you can see how this could help you in your selections. Look at what parameters you think you ideal stock would fit into. Try entering different amounts in the various fields and see what results pop up. The amounts that I used for the example here are not necessarily what you want to look for. They were merely used for illustration purposes.

Maybe you want to concentrate only on companies that have large market capitalizations. That means that you are investing in companies with a worth of over 10 billion dollars. How you set your search parameters is another discussion, the simple fact is you can use this tool to help you to separate the stocks you are interested in from the rest of the market. The more factors you decide to use, the more selective your results will be. You can choose companies that had a constant growth of 15 percent per year for the past five years, past five quarters, etc.

Once you have found the criteria for your stock selection and used this tool to give you some companies that meet that criteria, then you are ready to examine the companies, doing your due diligence, and decide which really looks good to you.

Another good stock screener with tons of features is MSN Deluxe Stock Screener. It is probably the best free stock screener available, and one of my favorite. To access it you will have to use Internet Explorer because it looks like it doesn’t work in Firefox. It is pretty advanced though, so you will definitely have to know what you are doing.

Another good free stock screener is Yahoo Finance Stock Screener. But make sure you check out all three to see which one is the best for you.

Stock screener is truly invaluable tool for finding good stocks so in the future I will talk more about it and how to use is to find potentially good stocks.