Sector Screening Benefits

When Screening for "say" Covered Call opportunities or Naked Puts, investors should consider narrowing down their search. This search should center on stocks (companies) you feel comfortable with owning and also in a group or marker industry you feel secure or familar with.  Many investors will just run a Screen with very littel parameters and focus on the potential Return. This could lead to investor pitfalls and with higher potential returns comes higher Risk. We have heard stories of Investors making consistant returns throughout the year, only to be "slammed" by one negative trade. Often, that one trade is a risky play offering "grand" returns. 

When Screening, Members on OptionScanner's Screening Tools can focus on higher Market caps companies, better PE's, Use various performance metrics, etc. However, users should utilize the "Market Sector/Group" Screener to narrow down their results within their comfort level. For Example, they can Screen stocks just in their own "watchlist", S&P 100, DOW 30, and say Banking if they are trying to foucs on more steady returns without the risk. 

Conversely, users looking for higher returns and who are willing to take the risk can Screen lower -middle range market caps in Technology sectors, Nasdaq , etc. The Key is to stay within your comfort zone and avoid the urge to hit a home run every time.



 


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