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Five tools for stock traders

There is a new era for stock trading. Technology is the new norm and can help you stay competitive while trading stocks. 

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Richard Drew/AP/File
In this Dec. 16, 2015 file photo, traders Gordon Charlop, left, Nathan Wisniewski, center, and Gregory Rowe, work on the floor of the New York Stock Exchange. Stock trading technology can help traders stay abreast in a new age of electronic trading.

The days of reading stock quotes in the newspaper are long gone. Now, stock traders get streaming quotes on their smartphones, make trades via their tablets or advanced trading platforms, and get company news and updates via Apple Watch alerts, chat rooms and Twitter.

Bottom line: If you’re not taking advantage of stock trading technology, you’re missing out. The following tools can streamline your process, improve your research capabilities and possibly boost your returns.

1. A strong trading platform

Choosing a broker with a robust trading platform is step one, and it can create a tricky balance. Often, brokers with advanced trading platforms have higher trade commissions or require a minimum number of trades or a minimum account balance to access the platform.

There are, however, some clear leaders here: TD Ameritrade heads the pack with its thinkorswim and TradeArchitect offerings, both of which are available to all customers (though its trade commissions are on the high side at $9.99). OptionsHouse also has strong trading tools with a lower commission at $4.95 per trade. And for advanced traders, Interactive Brokers has a well-regarded platform and low commissions.

2. A mobile trading app

If you’re serious about trading, you’ll want to be able to do it on the go, which means choosing a broker with a strong mobile trading app. These apps range from bare-bones — the ability to execute basic trades and view quotes — to a near mirror image of a Web or desktop platform, with advanced capabilities like charting, complex options trades and stock screeners. Two of the best online broker trading apps are from TD Ameritrade and E-Trade.

3. Stock screeners

Stock screeners take much of the weight off the trader’s plate, allowing you to quickly search for a stock based on criteria you’ve defined, like market capitalization (in other words, the value and size of the company), dividend yield, industry or share price.

Most of the trading platforms offered by online brokers include a screener, and some brokers also have screeners for exchange-traded funds, mutual funds or options. But many advanced traders recommend Finviz, which has in-depth screening capabilities that can help you dial down to trade opportunities. The site also offers charts, U.S. and international market maps and quotes. The basic services are free, but Finviz offers an elite subscription that starts at $24.96 a month.

4. Stock charts

Charting is integral for any trader who uses technical analysis, which involves evaluating past movements as a means to predict future performance.

Stock charts assist in that analysis by showing the performance of a security over time, allowing traders to recognize patterns and look at various technical indicators. Users can employ charts to dig into a stock’s history and recognize volatility, and can compare multiple securities and benchmark performance to indexes, like the S&P 500.

Online brokers offer charting capabilities that vary in depth; outside resources include websites like TradingView and StockCharts.com, which both offer a number of free features as well as upgraded memberships. StockCharts.com offers a ChartSchool to get new users familiar with charting.

5. Idea-generation tools

There are a lot of ways to come up with trade ideas, including subscription-based services. Briefing.com is one of the most popular, offering live market updates, IPO previews, emerging growth stock opportunities and more. Another service, Seasonalysis, identifies seasonal stock trends.

The other form of analysis frequently used by traders is called fundamental analysis, which involves digging into financial statements, company news and outside research reports by professional analysts. By doing this, you get a clearer picture of how individual companies and industries are doing, and that can lead to trade ideas.  

Brokers often provide this information from third-party sources, and the more research available, the better. Fidelity in particular is known for its breadth of research.

This article first appeared at NerdWallet.

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