By taking the same analysis criteria we use for individual stocks and applying them to a group of stocks, theScreener.com creates what we call "aggregates". This systematic approach makes it possible to compare aggregates in the same way one compares stocks.

The Aggregate Value (Aggr Value) is a theoretical value assigned to an aggregate based on a combination of the stock values within the aggregate. The Aggr Value helps you to see how an aggregate is situated in relation to its Technical Reverse (Tech Reverse). An aggregate whose Aggr Value is inferior to its Technical Reverse will have a negative Medium Term Technical Trend and an aggregate whose Aggr Value is superior to its Tech Reverse will have a positive Medium Term Technical Trend.

This is a list of investment-quality stocks that can be used for asset allocation.

A stock will qualify for the Asset Allocation List (AAL) when it has three or more stars and:

A stock will be removed from the Asset Allocation List (AAL) when it drops to one or no stars and:

Bollinger Bands represent the average expected fluctuations over 20 days set to 2 standard deviations. A breakout of the band is very often a sign of a trend reversal in the short term.

Should the two bands contract, it indicates a strong drop in volatility, signaling that the market is about to trend (positively or negatively). One of the oscillators (the Screener's Trend Oscillator, MACD, or RSI) will confirm the possible direction of the new trend.

The symbol [] implies that compared with their earnings revisions of seven weeks ago, the analysts have now raised their estimates (7wk EPS Rev; > 1%); the symbol [] indicates that compared with their earnings revisions of seven weeks ago, the analysts have now lowered their estimates (7wk EPS Rev < -1%).

When the earnings revisions (7wk EPS Rev) fall between +1% and -1%, the trend is considered to be neutral [].
The symbol [] indicates that the revisions previous to the neutral situation were positive.
The symbol [] indicates that the revisions previous to the neutral situation were negative.

The 4,500 stocks in theScreener.com's database are divided into 18 internationally recognized standard industry groups.

It is the basis of our Valuation Rating. This is the estimated growth of future earnings (LT Growth) plus dividend in %, divided by the estimated future PE ratio (Long Term P/E).

Our G/PE Ratio measure is an index figure that compares firms on whether their stock is relatively "expensive" or "inexpensive" according to their potential earnings growth. We focus our attention on G/PE Ratio measures generally between 0.9 and 1.6, as this range of the index is most likely to include firms that will outperform their peers. A G/PE Ratio measure below 0.9 indicates that investors must pay a premium for the estimated growth potential; thus, the stock is relatively risky.

In this easy-to-use rating system, stars are earned for each element specified below:

Therefore, a stock can earn a maximum of four stars. The lowest rating a stock can have is no stars.

Note : For each category, once a stock has earned its star it will keep it until:

This is the estimated annual growth rate of future earnings, normally projected over the next two to three years, and expressed as a percentage.

Our Long Term Growth measure is averaged over at least three different estimates obtained from banks, brokers, or analysts. A figure of 18 means that for the next two to three years, the growth in company earnings is evaluated at an average of 18% per year.

Caution: Be skeptical of high long-term growth projections that differ greatly from growth rates of associated national market indexes or industry groups. These can often result from very low earnings for the most recent few years, thereby making a firm's projected earnings growth appear very strong by comparison with the lean years. To verify this information the Industries and Indexes functions can be very helpful.

It is the PE ratio calculated on the basis of estimates of long-term earnings.

The MACD (Moving Average Convergence Divergence) calculates the difference between the 12 and the 26 day moving averages. Buy and sell signals are triggered by movements in the MACD signal line, which is based on a 9 day moving average.

If the MACD and 9 day moving average lines cross below the zero level it indicates a buy. If they cross above the zero level beware of a decline. In order to reduce the amount of buy-sell signals, we synchronize our MACD with a RSI (Relative Strength Index). If the RSI is above 0.6, no buy signal is given, and if the RSI is below 0.6, no sell signal is given.

This indicator is quite effective in stochastic or oscillating markets.

theScreener.com provides analysis on stocks from 32 countries; we call those countries, Markets.

This number is calculated by multiplying a firm's share price by the number of outstanding shares.

This is a theoretical price assigned to an index. The Market Value price is a result of a weighted combination of stock prices within the index it represents. The Market Value helps you to see how an Index is situated in relation to its Technical Reverse price. An Index whose Market Value is inferior to its Tech Reverse will have a negative Medium Term Technical Trend.

In order to offer a little more security in the selection of stocks, we have added a technical rating that we call a "Trend Follower".

This is by no means a tool for detecting reversals in tendencies, but is simply a measure of the persistence of a given tendency.

The column MT Tech Trend indicates the current tendency, positive [] or negative [], and the column Tech Reverse indicates to which price this tendency is valid.

When a price falls between 1.75% above or below the Tech Reverse, the MT Tech Trend is considered neutral []. Once the price breaks out of the +1.75% neutral zone, the MT Tech Trend will change to positive or negative depending on the movement.

The symbol [] indicates that the MT Tech Trend previous to the neutral situation was positive.
The symbol [] indicates that the MT Tech Trend previous to the neutral situation was negative.

The MT Tech Trend can be thought of this way: if it is positive it indicates that the market currently "likes" (or, is buying) the stock. If it is negative it indicates that the market currently "does not like" (or, is selling) the stock.

If, for example, at the current update a stock's MT Tech Trend is down [] but during the previous update period it was up [], it is considered to be "Moving down".

Example:
During the June 1st update period a stock's MT Tech Trend was positive. By the time of the June 4th update the stock's price dropped below its technical reverse point. This would trigger the MT Tech Trend to turn negative and the stock would be considered to have a MT Tech Trend "Moving down".

If, for example, at the current update a stock's MT Tech Trend is up [], but during the previous update period it was down [], it is considered to be "Moving up".

Example:
During the June 1st update period a stock's MT Tech Trend was negative. By the time of the June 4th update the stock's price was higher than its technical reverse point. This would trigger the MT Tech Trend to turn positive and the stock would be considered to have a MT Tech Trend "Moving up".

This is an abbreviation for the number of stocks in an industry group aggregate or index. By clicking on the underlined number you can access the list of stocks that make up that industry group or index.

A stock is only considered a New Trading Opportunity for the duration of one update. At the moment of the next update, depending on the movement of the stock price, it is either closed (as a Take profit / Stop), or it continues as an Open Position.

If you decide to invest in an Open Position, it is important to watch it closely, as it may already be mature. You can always check the date and price at which a stock became a New Trading Opportunity, as well as the current Take profit / Stop limit by looking in the stock's Checklist View and Analysis View under the heading of Timing. You can also find the Take profit / Stop limit in the stock's Chart View in the form of a dashed blue line that starts the moment a stock becomes an Open Position, moves parallel below its price, and ends the moment the stock price line drops below it, thus triggering a Take profit / Stop signal.

Understanding the risk involved in a Trading Opportunity, theScreener.com programs in a progressive Take profit / Stop limit for all of its Trading Opportunities. However it is important to note that it is completely up to you to decide whether or not this limit fits your investment strategy.

Frequency
Depending on the climate of the market in general, you may find that you often have few or even no New Trading Opportunity. This is normal, since trading opportunities are based on timing and timing doesn't always accommodate the market.

See also Timing / Trading Opportunities.

A stock is only considered a New Trading Opportunity for the duration of one update. At the moment of the next update, depending on the movement of the stock price, it is either closed (as a Take profit / Stop), or it continues as an Open Position.

If you decide to invest in an Open Position, it is important to watch it closely, as it may already be mature. You can always check the date and price at which a stock became a New Trading Opportunity, as well as the current Take profit / Stop limit by looking in the stock's Checklist View and Analysis View under the heading of Timing. You can also find the Take profit / Stop limit in the stock's Chart View in the form of a dashed blue line that starts the moment a stock becomes an Open Position, moves parallel below its price, and ends the moment the stock price line drops below it, thus triggering a Take profit / Stop signal.

Understanding the risk involved in a Trading Opportunity, theScreener.com programs in a progressive Take profit / Stop limit for all of its Trading Opportunities. However it is important to note that it is completely up to you to decide whether or not this limit fits your investment strategy.

Frequency
Depending on the climate of the market in general, you may find that you often have few or even no New Trading Opportunity. This is normal, since trading opportunities are based on timing and timing doesn't always accommodate the market.

See also Timing / Trading Opportunities.

In technical terms this means that a stock's price (or an industry group's value) has risen dramatically in the short term, and, from a timing perspective, it might be too late to buy.

In technical terms this means that a stock's price (or an industry group's value) has fallen dramatically in the short term, and, from a timing perspective, it might be too late to sell.

This is the price of a stock at the time of the latest update, and the currency that it is traded in.

The RSI (Relative Strength Index) is an oscillator that measures the percentage of positive movements compared with the absolute value of all the movements. This oscillator is normally calculated on 14 or 21 days. Since, at theScreener we provide biweekly updates, we feel the 21 day method is best for this chart. This oscillator can vary between 1.0 and 0.0. If it is 1.0, it means that 100% of the movements during 21 days were positive. If it is 0.0, it means all of the movements during the 21 days were negative.

This indicator is quite effective in stochastic or oscillating markets.

theScreener's Trend Oscillator can be defined as the ratio between the difference in the stock's price and the sum of the absolute values of all the movements during the course of one month.

This oscillator can vary between +1 and -1. As a general rule, breaking out of the +0.5 or -0.5 level signals a trend (positive or negative respectively).

This indicator is quite effective in trend driven markets.

theScreener.com uses what is called a progressive Take profit / Stop. This means the Take profit / Stop level rises only if the stock price rises. As soon as the stock's price drops lower than its Take profit / Stop price, theScreener.com automatically closes the position.

Using the Take profit / Stop signal: Understanding the risk involved in a Trading Opportunity, theScreener.com programs in a progressive Take profit / Stop limit for all of its Trading Opportunities. However it is important to note that it is completely up to you to decide whether or not this limit fits your investment strategy.

We would like to emphasize that just because theScreener.com signals trading opportunities and provides stop limits it is not a magic formula guaranteed to generate profitable trades each time. Our New Trading Opportunity are merely signals that suggest: "with this stock, at this price, under current conditions, there may be an opportunity to make a trade", and they should be treated appropriately.

See also Timing / Trading Opportunities.

This is the price at which we project the momentum to reverse. When a stock's price crosses over its technical reversal point, it can be an early signal for a potential buy or sell.

theScreener.com uses three methods to identify trading opportunities:

Method 1: Trend Follower
Method 2: Contrarian25
Method 3: Contrarian5

For an individual stock to qualify as a Trend Follower trading opportunity, it must meet the following criteria:

For an individual stock to qualify as a Contrarian25 trading opportunity, it must meet the following criteria:

For an individual stock to qualify as a Contrarian5 trading opportunity, it must meet the following criteria:

Trend Follower, Contrarian25 or Contrarian5?
It is important that you choose the method that best fits your investment strategy. Therefore, before pursuing a trading opportunity, we suggest you carefully read through the descriptions above and then consult the stock's Checklist View to see if the trading opportunity you are interested in is a Trend Follower, Contrarian25 or Contrarian5. Keep in mind that the Trend Follower is designed to rise with a stock that is already showing some upward movement. The Contrarian trading opportunities target stocks that are rebounding from a bottom. Be aware that the Contrarian trading opportunities generally imply a greater degree of risk than Trend Followers, so use them with caution.

Timing and risk
Using timing can certainly lead to very profitable trades, however the "risk / reward" rule holds especially true here. Since trading opportunities often last for only a very short time, and by definition involve stocks that are "on the move", you should be particularly vigilant when trading these stocks.

See also New Trading Opportunity and Take profit / Stop.

Our Valuation Rating indicates if a stock is selling at a relative premium or bargain price, based on its growth potential.

To estimate a stock's value relative to its current price our Valuation Rating combines:

By combining these elements we can establish a rating for the analyzed company.

There are five ratings, ranging from strongly undervalued [] to strongly overvalued [] (see below).

When we analyze a company's projected long-term earnings growth, we place a certain emphasis on the G/PE Ratio. While the first two elements in our analysis are important, and fairly simple to understand (stock price and current earnings), the G/PE Ratio merits further explanation.

Some analysts watch the PE (Price Earnings ratio) - the ratio of stock price divided by earnings per share. In general, this ratio is fairly linear: a low PE suggests an inexpensive/low-risk stock, while a high PE suggests an expensive/high-risk stock.

In our model, the concepts of expensive/inexpensive do not depend on the PE, but on the relation between the PE and growth. Multifactor analysis has showed that the estimated growth of earnings provides the best base for the evaluation of a stock. There is approximately a 60% correlation of estimated earnings growth to stock value.

Our G/PE Ratio measure quickly evaluates a company and detects firms that offer the greatest relative potential for the future and are therefore, the most undervalued. Correspondingly, our G/PE Ratio also detects firms that offer the least relative potential for the future and are thus, the most overvalued. Our G/PE Ratio measure conveniently compares two stocks at a glance. Our growth projections are always based on an average of at least three estimates.

The moment an investor buys a stock, the stock's present situation becomes the past, and the success of the investment depends fully on the future. theScreener.com takes into consideration the current earnings situation for a company but focuses on the future in order to establish a true Valuation Rating.

The volatility bands are calculated using moving averages, adjusted up or down by the annualized volatility. The widest band represents fluctuations based on an average of 40 days, indicating possible movements in the medium term. The thinnest band is calculated on the same principle, but on a shorter frequency of 20 days.

When the stock's price breaks out of the bands it is a statistical anomaly and a return to the interior of the bands can be expected within the coming weeks.

When the interior band touches the exterior band, the stock's price very often rebounds in the opposite direction.

This is the percentage of stocks in a given list that have a positive Medium Term Technical Trend. If, for example, the aggregate of Technology / World, which is made up of 458 stocks has 8% "of stocks in Uptrend", it means that 38 of the stocks within that aggregate have a positive Medium Term Technical Trend.

This figure measures the performance of a stock relative to its national index (compared to four weeks ago).

For example, a grade of 2 for a given stock would mean that this stock performed 2% better than its national index. On the contrary, a grade of -3 would indicate a performance of 3% under the index. We have chosen not to show the absolute performance, since the index remains the valid benchmark. For a given stock, figures that show an absolute gain of 2% in a market that also gained 2% do not represent any remarkable information. However, a stock that consistently beats its national index is clearly one sought after by investors. A chronic under-performance, of course, would indicate serious problems.

In fact, we use 4 week Relative Performance compared to Earnings Revision Trend. A positive Earnings Revision Trend for a stock that does not show a positive 4 week Relative Performance rating should force the investor to question the pertinence of this revision. In the other direction, a stock with a negative Earnings Rev Trend that stills beats its index (4wk Rel Perf > 0) means that something special is happening with this stock, since investors are still buying it.

This is an abbreviation for 7 week Earnings Per Share Revision. This column concerns the value of these revised earnings. A figure of 2.8 implies that the analysts, compared with seven weeks ago, have now revised and raised their estimates by 2.8%. On the contrary, a negative number means that the earnings were revised at a lower estimate.