Wheel Strategy: How I Find Stocks Using Finviz Screener

in this video i'm going to share with you how i choose stocks for the real strategy the wheel strategy is a very famous regime i already made videos on the subject on what is the real strategy for example and if you haven't watched it i'll put a link into the description of this video where you can go watch that video i also give a spreadsheet where you can track your cost basis so don't hesitate to watch it before watching this video i'll share with you the different criteria that i use so as to select the stocks that i'm going to trade for the real strategy and also show you using a screener how you can input those criteria so it can make the process way easier for you but before diving into this video if at any point you find this video interesting or helpful and you actually learned something then don't hesitate to subscribe to my channel and liking this video that's the best way to let me know that you'd like to see more videos like this one so as i said if you have no idea what the wheel strategy is it's probably better if you go watch the video that i made on the subject first where i explain what is the wheel strategy step by step so maybe it's clearer for you but if you already know what the wheel on strategy is let's get right into it so the way i'm going to explain you how i choose the stocks for the real strategy is going to go step by step with the screener so what i really recommend you to do right now is to go into the description of this video you'll see the link of the finvie screener in the description i really suggest you to click on it and we're going to go together step by step i'm going to show you which type of criteria i like to put into the screener so you can maybe do the same at the same time on your end so you can do it at the same time as i'm doing it so as you can see i am in the filmv screener so this is the screener that you will find if you go into the description and you click on the link you can see that there are basically all of the filters up there and they are then on the results down there you see that there are different filters that you can put for example more descriptive with the index the dividend yield but you can also talk in terms of fundamentals if you want to screen stocks based on different dimensions you can also use some technical analysis if you like to screen stocks that way so the first thing that i'd like to focus and this is really the first criteria that is super important for me to focus on first of all is liquidity liquidity refers to basically the number of traders like trading a certain stock the more participants there is trading the same stock the more liquidity there is and vice versa if no one is actually trading a stock we said that it's illiquid and the benefit of trading only liquid stocks is that you're going to be filled at very at the best prices possible because if on the opposite to go trade the liquid stock you're going to see that first it's very hard to get filled you're going to get failed at bad prices you won't be able to get out of your trade with your profits i mean there is no reason why you should go trade liquid stocks like that's why the first thing to think about is liquidity so if we go into the screener and we try to improve that liquidity criteria where should we go well when we are in the screener page if you go where it's written current volume you can see that if you click on it there's going to be plenty of different choices so which one should you choose well personally i like to stick to stocks that have at least 2 million shares traded per day of course you can go for whatever you want but going for 2 million shares at least being traded per day is going to help you at least ensure that the stocks are going to be shown are at least fairly liquid so if we click for example over 2 million you see that the stock screener is going to get adapted directly i don't know if you saw before we read 160 pages of different stocks now we are only at 45 pages of different stocks that are resulting out of this criteria so you see that we already eliminated a lot of different stocks that we could have chosen because they were just illiquid so now we are only focusing on liquid stocks which is really nice and now the second criteria that i think is very very important that's something that i like to use for the real strategy and i'm going to explain why i like to go for medium price stocks what does that mean well i like to trade stocks using the one strategy they are around forty dollars per share fifty dollars per share maximum and there are reasons why when we use the win strategy we're going to have to sell puts we're going to have to buy shares at some points and we're going to have to sell calls and the thing is i always like to think about the worst care scenario when i sell for example naked puts or when i buy shares what is the worst scary scenario well the worst case scenario if you for example sell a put on a stock or you have for example shares is if the stock falls to zero and for example gets delisted and i know that sounds like a crazy outcome but that's actually happened way more times than what we think and it's not something that is that unusual and the reason why i like to go for stocks that are priced around 40 per share is that if the stock falls to zero and let's say gets delisted at least i'm not going to lose that much money meaning that if i have 100 shares at the stock price at 40 per share then maximum i'm going to lose 4 000 because i will have about 100 shares at 40 per share so 4 000 in terms of investment and if it gets to zero that's the maximum that i can lose i don't like to go for expensive stocks when using the wheel strategy and the reason is very simple if you for example trade amazon and you like to use the one strategy on amazon and at some point you need to buy a hundred shares add for example let's say three thousand dollar per share then three hundred thousand dollars that are being allocated just for amazon and of course the probability of seeing amazon getting delisted is very very low however it still exists and my philosophy is that i rather go for a stock that is like around forty dollars fifty dollars where i risk way less money compared to a very expensive stocks where the more expensive it is the more risk you're actually taking if the stock let's say falls to zero and another benefit of going for stocks that are around forty dollars fifty dollar per share is that you need less capital you need less buying power so as to actually use the real strategy and that's a very nice thing if you have a small capital if you don't have like tens of thousands of dollars just to trade then you might as well go for cheaper stocks because it's going to take you less capital it's going to be more affordable for you and you're going to be able to manage your risk a lot better that's how i started using the world strategy i started focusing on very cheap stocks because i just didn't have the money so as to invest on very expensive stocks and i started having more and more capital i started going for more expensive stocks but always with a limit of around forty dollars fifty dollar per share and i found that using the wheel strategy for stocks that are around forty dollar per share fifty dollar per share was actually way better because i needed less capital i could manage my risk better meaning that if the stock falls to zero at least it's not as if i had traded a 200 stock and if i want to start taking more risk i can just start using the wheel strategy on different stocks that are around forty dollars instead of just one big stock at let's say two hundred dollar per share i could go for two or three stocks that are around forty dollar fifty dollar per share so at least i spread my risk and i don't just have my risk in a single position so that was a long explanation but i hope i hope it makes sense so if we go into the finve screener and we try to input that if you go into the price filter you're going to see that when you click on it there's plenty of different options you can see if under one dollar and the fifty dollars over ten dollars what i like to choose is let's say twenty dollars to fifty dollars and that basically encompasses the range of stock that i like to trade between twenty dollars and fifty dollar per share that's usually where i'm going to focus for the real strategy and that's going to be stocks that are around forty dollars per share thirty dollars fifty dollars somewhere around this basically and you see that before we had 45 pages of result just with the volume filter and now we're done at 12 pages of stock so you see that we're reducing the number of candidates and that's exactly what we want we want to reduce the number of candidates so we have in the end a list of liquid stocks that are around 30 40 per share that are really liquid that you can trade for the real strategy but it's not over so let's see what is the next criteria the third criteria and that's something that is quite special that's something that i came up with that i really like to use in general i like to use the one strategy on stocks that recently went down and the reason for that is that when you sell a put you are bullish on the stock so if i can avoid selling a put when the stock is at its highest then i'm going to do so because at least if i sell a put on a stock that recently had a pullback at least i'm not going to be assigned at the highest point possible because the thing that you don't want is to for example sell a put on a stock when it's at its highest and then the stock starts going down and you just get assigned at the worst strike possible that's why i like to use that criteria meaning that i'm going to start using the real strategy on stocks that had recently a pullback so at least i know that i'm not going to be assigned at the highest point possible and i know that have discussion of safety and i'm going to show you examples after that with like the stocks that are being given by the screener at the end so you can see what i mean so don't worry if you don't understand everything right now just follow me follow the filters and i'm going to show you examples after that so if we were willing to input that into the screener meaning stocks that recently got a pullback how would we do that well if you go into the technical columns here if you click on it technical you're going to be able to input filters there are more from a technical analysis standpoint which is basically what we want here what i like to use the filter that i like to use is the performance filter so if you go on the top left corner you see that there's going to be a performance filter if you click on it you see that it's going to basically allow you to filter for stocks that have had some performances that you want so for example you could only see stocks that today went up or today went down or at least today lost 10 percent or this week i mean basically whatever the performance that you want to have the screener will show you stocks with the performance that you chose so what i like to do personally is to choose the weak down performance and what does that basically do well the screener is going to show me stocks that went down during the last week and that basically refers to that pullback that i was talking about as i said i like to use the one strategy i like to start the wheel on strategy by selling put on stocks that recently got a pullback so at least i ensure that i'm not selling a put at the highest strike possible at least i'm having this caution of safety and selling a put who actually got a performance where the stock went down during the last week is exactly doing this because now i'm selling a put on a stock that recently went down during the last week so i'm actually doing this and it's being given by a screener which is quite nice and once again you see that before we were 12 pages and now we are only at seven pages so you see that we are really short listing candidates and we're really making sure that we only have the best candidates possible for the wheel strategy and if we look at the different stocks that are being given by the screener we can already see the pullbacks that i was talking about for example here they show enbridge from the stock ticker enb and if we look at the chart that is being given you see that the stock price basically went down during the last week which refers to that pullback that i want to see when using the wheel strategy i want to start the one strategy on the stock that just had a pullback so at least i'm sure that i'm not going to sell a put at the highest price possible and if i keep going down you see that every time you put your mouse on the stock seeker it shows you the chart directly so fcx some same thing you see that for example bsx the same thing i mean basically all of those stocks have had a performance where they went down during the last week so i think that's quite nice to be able to see these type of screeners that show you the stocks that went down during the last week so you can really adjust your strategy and you can really choose the best candidates possible for the real strategy and to give you an example of what i would do once i'm at that point and once i've seen you know for example i've reduced my short list to all of those stocks uh well i'm going to go for example stock by stock and i'm going to choose a stock that i actually feel like trading for the one strategy so for example hpq would be in my opinion a good candidate for the winner strategy and if we go for example into test works to check hp you see that since october it literally went from 17 to 35 and that's where i think that using that weak down performance is actually very useful because the what you don't want to see is the following let's say that the stock is at 35 and you you start selling a put that is just below that is let's say the 35 strikes so basically you really sell a put when the stock is at its highest and then the stock starts going down so you see that it went down to 32 dollars and that's why you would be really pissed because you're going to be assigned at a very high price you're going to be assigned literally at the highest price possible that's why at least having stocks that just got a pullback at least if i start selling a put now i'm going to try to sell for example the 31 strike which is going to offer me some kind of caution of safety i'm going to have a margin of safety well at least i didn't sell to put at the highest strike possible at least took advantage of that pawn bike after that once we're there personally that's what i'm going to stop in terms of criteria and i'm going to look more on an individual basis to see which stock is going to help me so after that you obviously still have a lot of choice i mean you see that we still have seven pages but at least we went from literally no filter at all to reducing that to seven list of potential candidates what i personally like to do is filter after the stocks by clicking on the market cap that you can see here and basically it's going to give you the stocks that have the biggest market capitalization first and i like to do this because market capitalization is quite important for me i want to trade stocks that are really solid with big financials with good financials so i'm going to filter stocks by the market cap and i'm going to go for very solid stocks for example i would go as i said for hp but after that using the market cap is really just my personal opinion i mean you can do after that whatever you want it's really up to you to choose the criteria that you want i just wanted to share with you the different criteria that i use so as to find good candidates for the real strategy because that helped me to actually use it that way i hope you found this video useful where i share with you some of the criteria that i like to use so as to find good candidates for the real strategy let me know in the comment section if there are any other criteria that you like to use as to find good stocks for the real strategy and if there is anything that you look at that i haven't mentioned in this video i'd be curious to hear what you use if you have any question as always about the screener or anything that i said don't state to comment it below i'll be happy to answer any question that you might have please make good and informed decisions i'll see you in the next video and in the meantime i wish you all the best

Channel: JC Gilbert

Views: 3,559

Rating: 5 out of 5

Keywords: finviz stock screener, stock screener, finviz swing trade scan, how to find stocks, how to swing trade, stock scanners, finviz screener, how to use finviz, stock trading, day trading, theta gang, finviz stock screener swing, stock scanners for swing trading, swing trading scanner setup, finviz stock screener swing trading, finviz screener for swing trade, finviz stock screener day trading, stock trading for beginners, stock trading 101, options wheel strategy, stock market

Id: 9epwZAXVsVo

Length: 14min 25sec (865 seconds)

Published: Sat May 29 2021