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Master systematic opportunity discovery. This comprehensive guide teaches you how to use Parallax’s advanced stock screener effectively, from basic filtering to sophisticated institutional-grade screening strategies. The screener combines traditional fundamental analysis with proprietary factor scoring, enabling you to discover investment opportunities that align with your specific investment philosophy and risk parameters.

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Getting Started with Stock Screening

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Understanding the Screener Interface

PanelFeatures
Filter Panel (Left)Basic filters, factor scores, fundamental metrics, technical indicators, custom filters
Results Panel (Center)Real-time results list, customizable columns, sorting options, action buttons
Detail Panel (Right)Individual stock analysis, factor breakdown, peer comparison, integration options

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Your First Screen: Step-by-Step

1

Define Your Investment Universe

Start with broad parameters:
  • Market Cap: All (or specify Large/Mid/Small cap preference)
  • Geography: US (expand internationally as you get comfortable)
  • Sectors: All (or focus on sectors you understand)
  • Minimum Volume: 100,000 shares/day (ensures liquidity)
2

Apply Basic Factor Criteria

Begin with simple factor requirements:
  • Overall Parallax Score: > 6 (above average quality)
  • Quality Factor: > 5 (basic quality threshold)
  • Value OR Momentum: > 6 (choose based on market conditions)
3

Review and Refine Results

  • Review the number of results (aim for 20-100 for detailed analysis)
  • If too few results: Lower factor thresholds or expand universe
  • If too many results: Tighten criteria or add additional filters
4

Analyze Top Candidates

  • Sort by Overall Parallax Score or your preferred metric
  • Review top 10-20 results in detail
  • Click individual stocks for comprehensive analysis

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Advanced Screening Strategies

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Factor-Based Screening Approaches

Investment Thesis: Find high-quality companies with strong growth prospects
CriteriaValue
Quality Factor> 8
Momentum Factor> 7
ROE> 15%
Revenue Growth (3Y)> 12%
Debt/Equity< 0.5
Market Cap> $2B
Typical Results: 15-30 stocks | Review Frequency: Monthly | Best For: Growth-friendly environments

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Multi-Factor Combinations

Balanced Factor Approach: 
Investment Thesis: Well-rounded companies across multiple factors
Screening Criteria:
  Overall Parallax Score: > 7
  No factor score below 4 (avoid major weaknesses)
  At least two factors > 7 (ensure strengths)
  Market Cap: $1B - $50B (mid-to-large cap sweet spot)

Typical Results: 40-80 stocks
Best For: Most market environments (all-weather approach)
Momentum + Quality Screening: 
Investment Thesis: High-quality companies riding positive trends
Screening Criteria:
  Quality Factor: > 7
  Momentum Factor: > 7
  6M Price Return: > 10%
  Earnings Revisions: Positive trend
  ROA: > 8%
  Interest Coverage: > 3x

Typical Results: 20-40 stocks
Best For: Bull markets, earnings upgrade cycles

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Sector-Specific Screening

Tech-Specific Criteria:
  • Sector: Technology
  • Quality Factor: > 6 (higher bar for tech)
  • Momentum Factor: > 5
  • Revenue Growth: > 15%
  • R&D/Revenue: > 8% (innovation focus)
  • Cash/Debt Ratio: > 1 (balance sheet strength)
Considerations: Focus on sub-sectors (software, semiconductors), consider growth stage, evaluate competitive moats
Healthcare-Specific Criteria:
  • Sector: Healthcare
  • Quality Factor: > 7 (regulatory resilience)
  • Defensive Factor: > 5 (stability requirements)
  • Operating Margin: > 15%
Considerations: Distinguish between pharma, biotech, and medical devices; consider patent cliffs; evaluate regulatory timelines
International Focus:
  • Geography: Developed International OR Emerging Markets
  • Market Cap: > $1B (liquidity requirements)
  • ADR Availability: Yes (US accessibility)
  • Quality Factor: > 6 (additional due diligence needed)
Regional Tips: European markets—focus on quality/defensive; Asian markets—emphasize growth/momentum; Emerging markets—higher quality thresholds
Small-Cap Specific:
  • Market Cap: 300M−300M - 2B
  • Quality Factor: > 6 (higher bar for small companies)
  • Revenue Growth: > 20% (growth requirement)
  • Analyst Coverage: > 3 analysts
  • Institutional Ownership: 20-80%
  • Trading Volume: > 50,000 shares/day
Risk Note: Higher volatility, lower liquidity, greater economic sensitivity

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Practical Screening Workflows

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Weekly Screening Routine

DayFocus
MondayRun broad momentum screen, review weekend news, update watchlists
WednesdayCheck earnings-driven opportunities, review screening alerts, analyze Monday’s candidates
FridayExport candidates to portfolio builder, review fit with existing portfolio, plan weekend analysis

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Market Cycle Adaptations

Early Bull Market

Emphasis: Value and Small-Cap factors
  • Value Factor: > 7
  • Size Factor: > 5 (small-cap tilt)
  • Beta: 1.2 - 1.8 (cyclical exposure)

Mid-Bull Market

Emphasis: Quality and Growth factors
  • Quality Factor: > 8
  • Momentum Factor: > 6
  • Revenue Growth: > 15%

Late Bull Market

Emphasis: Defensive and Quality factors
  • Defensive Factor: > 7
  • Quality Factor: > 8
  • Volatility: Below market average

Bear Market

Emphasis: Defensive and Value factors
  • Defensive Factor: > 8
  • Quality Factor: > 7
  • Debt/Equity: < 0.3

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Integration with Platform Features

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From Screener to Portfolio

Workflow Example:
  1. Screen: Find high-quality dividend stocks
  2. Export: Send top 20 results to portfolio builder
  3. Build: Create optimized dividend portfolio
  4. Analyze: Upload to analyzer for comprehensive review
  5. Implement: Execute trades based on analysis

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Using Chat for Screening Enhancement

AI-Assisted Screening: 
Chat Query: "What screening criteria should I use to find technology
companies that could benefit from the current AI trend?"

AI Response: Suggests specific factors, metrics, and sub-sector focus
Follow-up: Apply suggested criteria in screener
Validation: Discuss results with AI for refinement

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Watchlist Integration

Systematic Monitoring:
  1. Create Themed Watchlists: Group screened stocks by strategy
  2. Set Factor Alerts: Monitor when stocks meet/fail screening criteria
  3. Performance Tracking: Track how screened stocks perform over time
  4. Rebalancing Signals: Identify when holdings no longer meet criteria

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Screening Best Practices

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Avoiding Common Pitfalls

Over-Optimization: Don’t create overly complex screens that produce few results. Focus on 3-5 key criteria rather than 15-20 filters.Neglecting Qualitative Factors: Use screening as a starting point, not the final decision. Consider management quality, competitive position, and industry trends.Ignoring Market Conditions: Adapt screening criteria to current market environment. Understand which factors work in different market cycles.Poor Risk Management: Consider position sizing and portfolio impact. Don’t ignore correlation risk among screened stocks.

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Optimization Techniques

TechniqueDescription
BacktestingTest historical performance of screening criteria; optimize for risk-adjusted returns
Dynamic ScreeningAdjust factor weightings based on market conditions; use economic indicators
Portfolio ContextConsider existing portfolio when screening; screen for stocks that improve factor balance

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Advanced Screening Applications

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Event-Driven Screening

Pre-Earnings Screen: 
Momentum Factor: > 6
Earnings Revisions: Positive
Short Interest: < 5% (avoid squeeze risk)
Options Volume: Above average (anticipation)
M&A Target Screen: 
Value Factor: > 7 (attractive valuations)
Quality Factor: > 6 (strategic assets)
Market Cap: $500M - $10B (typical target size)
Institutional Ownership: > 50%
Recent Performance: Lagging sector (opportunity)

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Thematic Screening

ESG-Focused Screen: 
ESG Score: > 7
Quality Factor: > 6
Revenue from Sustainable Sources: > 50%
Carbon Footprint: Below industry average
Governance Score: > 8
Inflation Protection Screen: 
Sectors: Energy, Materials, Real Estate
Pricing Power: Strong
Historical Inflation Correlation: Positive
Dividend Growth: > Inflation rate

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Troubleshooting

IssuePossible CausesSolutions
Too Few ResultsCriteria too restrictive, unfavorable market conditionsLower factor thresholds, expand geographic/sector universe
Too Many ResultsCriteria too broad, bull market conditionsAdd quality filters, tighten factor requirements
Poor PerformanceMarket regime change, over-fitted criteriaAdapt to current conditions, simplify criteria

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Next Steps

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Developing Screening Expertise

  • Week 1-2: Master basic screening with single-factor approaches
  • Week 3-4: Combine multiple factors and understand interactions
  • Month 2: Develop sector-specific and market condition adaptations
  • Month 3: Create systematic screening processes and workflows