sector scan for stocks - the wizard scan for stocks.pdf · thewizarduniversity sector scan for...

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SECTOR SCAN FOR STOCKS

The Wizard’s Sector Scan is our most advanced strategy and is designed for experienced investors. The Sector Scan helps you find the groups - and stocks within them - that are most likely to move first, fastest and farthest. (Please note that the Sector Scan only applies to stocks - not to ETF’s.)

The Sector Scan allows you to:

1. For Buy Signals: Identify the strongest sectors and industries - the ones that are most likely to move up furthest and fastest - and then find Buy Signals on the strongest stocks within them.

2. For Sell Signals: Identify the weakest sectors and industries - the ones that are most likely to drop furthest and fastest - and then find Sell Signals on the weakest stocks within them.

This guide is broken into 4 parts:

Part 1: What are Sectors and Industries?How Sectors and Industries help you pinpoint your investing.

Part 2: The Sector Scan TourAn overview of the Sector Scan feature, its features and tools

Part 3: Finding Buy and Sell SignalsHow to find the best stocks within the best sectors and industries.

Part 4: Viewing Open PositionsViewing open positions with the Sector Scan.

Part 5: Three Strategies for Investing with SectorsThe three ways of using The Wizard’s Sector Scan

SECTOR SCAN FOR STOCKSUniversityWizardThe


Part 1: What are Sectorsand Industries?How Sectors and Industries help you pinpoint your investing.


Sector and Industries are CategoriesThere are over 10,000 stocks trading on U.S. stock exchanges. Each day, The Wizard scans well over 9,000 of these stocks. Any way you slice it, that’s a lot of stocks.

To make them easier to identify, stocks are grouped into categories. There are two types of categories.

SectorsA sector is a category of stocks that are grouped together by their general industry. Some examples of Sectors include:

1. Computer and Technology

2. Utilities

3. Transportation

IndustriesIndustries are sub-categories of sectors. Within each sector, there are a number of industries. The Transportation sector, for example, includes Industries such as:

1. Transportation - Rail

2. Transportation - Air

3. Transportation - Truck


Stocks move togetherSectors and industry groups typically move together. What this means is that stocks in a given sector or industry typically move together. Therefore, by identifying which sectors and industries are strongest and which are the weakest, we can quickly narrow down our universe of over 9,000 stocks to a handful of the best investment candidates.

Before we show you how to do this, let’s talk about what makes a sector or industry strong or weak.

Strong IndustryAn industry composed largely of stocks whose Trend = Buy.

The more stocks whose Trend = Buy, the stronger the Industry.

Strong SectorA sector composed largely of Industries whose Trend = Buy.

The more Industries whose Trend = Buy, the stronger the Sector.

Weak IndustryAn industry composed largely of stocks whose Trend = Sell.

The more stocks whose Trend = Sell, the weaker the Industry.

Weak SectorA sector composed largely of Industries whose Trend = Sell.

The more Industries whose Trend = Sell, the weaker the Sector.


First. Fastest. Farthest.When running a Sector Scan, The Wizard looks for stocks which exhibit three qualities:

They’ll move first

The Wizard looks for stocks that are likely to move up or down as soon as possible.

They’ll move fastest

Once they move, these stocks are likely to do so very quickly.

They’ll move farthest

These stocks will move up or down the furthest amount, resulting in higher profits.

In short, The Wizard aims to find the stocks that are most likely to offer the most profit potential in the shortest amount of time.

The Wizard looks for the stocks that are likely to move first, fastest and farthest.


A Top-Down ApproachTo do this, The Wizard uses a simple, top-down approach. Below is an overview of how it works. Later, we’ll show you the simple process for putting this exact plan into action.

STRONGEST SECTORS

STRONGEST INDUSTRIES

STRONGEST STOCKS

Look for the strongest Sectors

Look for the strongest Industries within those Sectors

Look for the strongest stocks within those Industries.

Finding Buy Signals

WEAKEST SECTORS

WEAKEST INDUSTRIES

WEAKEST STOCKS

Look for the weakest Sectors

Look for the weakest Industries within those Sectors

Look for the weakest stocks within those Industries.

Finding Sell Signals


Part 2: The Sector Scan TourAn overview of the Sector Scan feature, its features and tools

To perform a Sector Scan, click on the “Stocks” button at the top of the page...

Then click on the “Sector Scan” button

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The Sector Scan TourBefore we show you the process for using the Sector Scan, we’re first going to familiarize you with the layout for this section, so you can understand how it all works together.


Viewing the Sectors ListThe Sectors list provides you with the following information:

View Buy/Sell Signals button

View Open Positions button

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Sector Name

Trend of that Sector

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Sector Ranking

View industries button

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Sector Trend and Ranking

Sector TrendThe Wizard shows the Trend for each Sector. To learn more about the Trend, see our tutorial, Investing with the Trend.

Sector RankingAll sectors are ranked from strongest to weakest. The strongest sector is always ranked number 1. To sort the list of sectors by ranking, click on the tab at the top of the Ranking column. Clicking this tab a second time will re-sort the list in the opposite direction.

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Industries for Each Sector

View the industries in each sectorTo view the industries in each sector, click on the “Industries” button in the “View Industries” column. The Wizard also shows you the number of industries contained within each Sector.

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Sector Buy/Sell SignalsThe Wizard allows you to view the Buy and Sell Signals for all of the stocks within each sector.

Buy SignalsWhen the Market Trend = Buy, The Wizard will show you only Buy Signals.

Sell SignalsWhen the Market Trend = Sell, The Wizard will show you only Sell Signals.

No Buy/Sell SignalsWhen the Market Trend = Sideways, The Wizard will show you neither Buy nor Sell Signals.

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Sector Open Positions

For each Sector, you can also view the current Open Positions, simply by clicking on the orange button in the “View Open Positions” column.

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Viewing the Industries ListThere are two ways to view a list of Industries.

Viewing Industries within a SectorClicking on the “Industries” button for any Sector will show you a list of all Industries in that Sector

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Viewing All IndustriesClicking the “View Industry Rankings” tab will show you a list of all Industries, in all Sectors.

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Viewing the Industries ListThe Industries list provides you with the following information:

View Buy/Sell Signals button

View Open Positions button

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Industry Name

Trend of that Industry

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Industry Ranking

Parent Sector

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Industry Trend and Ranking

Industry TrendThe Wizard shows the Trend for each Industry. To learn more about the Trend, see our tutorial, Investing with the Trend.

Industry RankingAll Industries are ranked from strongest to weakest. The strongest Industry is always ranked number 1. To sort the list of Industries by ranking, click on the tab at the top of the Ranking column. Clicking this tab a second time will re-sort the list in the opposite direction.

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Industry Parent Sectors

View the parent Sector for each IndustryThe “Sector” column shows the Sector to which each Industry belongs, along with the Trend of that Sector. Clicking on the Sector name will show a list of all of the Industries within that Sector.

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Industry Buy/Sell SignalsThe Wizard allows you to view the Buy and Sell Signals for all of the stocks within each Industry.

Buy SignalsWhen the Market Trend = Buy, The Wizard will show you only Buy Signals.

Sell SignalsWhen the Market Trend = Sell, The Wizard will show you only Sell Signals.

No Buy/Sell SignalsWhen the Market Trend = Sideways, The Wizard will show you neither Buy nor Sell Signals.

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Industry Open Positions

For each Industry, you can also view the current Open Positions, simply by clicking on the orange button in the “View Open Positions” column.

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Part 3: Finding Buy and Sell SignalsHow to find the best stocks within the best sectors and industries.

The 4 Steps to Finding Buy or Sell SignalsFinding Buy or Sell signals for with the Sector Scan requires only 4 easy steps. You’ll find they’re easy to learn and even easier to follow. Successful investing is about being consistent, so make sure you follow these 4 steps each and every time you run a Sector Scan.

Step 1: CHECK THE MARKET TREND

Step 2: FIND THE BEST SECTORS AND INDUSTRIES

Step 3: SELECT YOUR OPTIONS

Step 4: VIEW BUY OR SELL SIGNALS


Step 1: CHECK THE MARKET TREND

As you’ll always do when looking for Buy and Sell Signals for Stocks, your first step will be to check the Market Trend. (If you need a more detailed explanation of the Market Trend, please see our Investing with the Trend or Getting Started with Stocks tutorials.)

When Market Trend = Buy... Only Sector Scan Buy Signals are shown.

When Market Trend = Sell... Only Sector Scan Short-Sell Signals are shown.

When Market Trend = Sideways...Neither Buy nor Sell Signals are shown.


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Buying the Strongest Sectors and Industriesif the Market Trend = Buy, you will be looking for Buy Signals. As a result, you’ll only be looking for the strongest stocks within the strongest Sectors and Industries. Here’s how you’ll do it.

Step 1: Locate the strongest SectorSort the list of Sectors by ranking, from strongest to weakest, and select the strongest Sector.

Step 2: View the Industries in the strongest SectorClick the “Industries” button to view the Industries within that Sector.

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Buying the Strongest Sectors and Industries

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3 Step 3: Locate the strongest IndustrySort the Industries list by ranking, from strongest to weakest.

Step 4: View Buy Signals for the strongest IndustryClick the “Buy Signals” button for the strongest industry.

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Selling Short the weakest Sectors and Industriesif the Market Trend = Sell, you will be looking for Sell Signals. As a result, you’ll only be looking for the weakest stocks within the weakest Sectors and Industries. Here’s how you’ll do it.

Step 1: Locate the weakest SectorSort the list of Sectors by ranking, from weakest to strongest, and select the weakest Sector.

Step 2: View the Industries in the weakest SectorClick the “Industries” button to view the Industries within that Sector.

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Selling Short the weakest Sectors and Industries

3 Step 3: Locate the weakest IndustrySort the Industries list by ranking, from weakest to strongest.

Step 4: View Sell Signals for the weakest IndustryClick the “Sell Signals” button for the weakest industry.

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Selecting Buy Signal OptionsOnce you’ve selected the Buy Signals for an Industry, your next step is to choose your Investing options. Because choices are very similar to those you will make using the Simple Scan and PowerScans tools, we’ll only be covering them briefly in this tutorial. For more information on selecting Buy and Sell Signal options, please see our tutorial, Simple Scan for Stocks: Finding Buy and Sell Signals.


1 Your Sector ChoicesShows you the Sector and Industry you’ve chosen. To change the Sector, click the “Change Sector” button. To change the Industry, click the “Change Industry” button.

Your Investing StyleChoose between Short-term and Long-term signals

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Your Investing SizeChoose your portfolio and individual investment size.

Find Buy SignalsClick the “Find Buy Signals” button to view a list of stocks with Buy Signals.

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Selecting Sell Signal OptionsOnce you’ve selected the Sell Signals for an Industry, your next step is to choose your Investing options.


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1 Your Sector ChoicesShows you the Sector and Industry you’ve chosen. To change the Sector, click the “Change Sector” button. To change the Industry, click the “Change Industry” button.

Your Investing StyleChoose between Short-term and Long-term signals

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3 Your Investing SizeChoose your portfolio and individual investment size.

Find Sell SignalsClick the “Find Sell Signals” button to view a list of stocks with Sell Signals.

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Viewing Buy SignalsOnce you’ve selected your options, you’ll be shown a list of stocks with Buy Signals. Once again, this list is very similar to those you’ll see using the Simple Scan and PowerScans tools, so we’ll only be covering them briefly in this tutorial. For more information on viewing Buy and Sell Signals, please see our tutorial, Simple Scan for Stocks: Finding Buy and Sell Signals.


1 Symbol Name

Trend / Ranking

Sector / IndustryFor each stock, The Wizard shows you its Sector and Industry, along with the Trend for each. Clicking on a Sector name shows you the list of Industries in that Sector. Clicking on the Industry name shows you the Buy Signals in that Industry.

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Buy Price

Stop Price

Profit Targets

Shares per Investment

Add to Portfolio / Watchlist

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Viewing Sell SignalsOnce you’ve selected your options, you’ll be shown a list of stocks with Sell Signals.


1 Symbol Name

Trend / Ranking

Sector / IndustryFor each stock, The Wizard shows you its Sector and Industry, along with the Trend for each. Clicking on a Sector name shows you the list of Industries in that Sector. Clicking on the Industry name shows you the Sell Signals in that Industry.

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Sell Price

Stop Price

Profit Targets

Shares per Investment

Add to Portfolio / Watchlist

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Part 4: Viewing Open PositionsViewing open positions with the Sector Scan.

The 3 Steps to Viewing Open PositionsViewing Open Positions with the Sector Scan requires only 3 steps.:

Step 1: SELECT YOUR SECTOR OR INDUSTRY


Step 3: VIEW OPEN POSITIONS


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View Open Positions within an entire SectorClick the “View Open Positions” button to see all of the stocks within that Sector that are currently in Open Positions.

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View Open Positions within an IndustryClick the “View Open Positions” button to see all of the stocks within that Industry that are currently in Open Positions.

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Selecting Open Positions OptionsOnce you’ve selected a Sector or Industry in which to view Open Positions, your next step is to choose your options. Because choices are very similar to those you will make using the Simple Scan tool, we’ll only be covering them briefly in this tutorial. For more information on selecting Open Position options, please see our tutorial, Simple Scan for Stocks: Viewing Open Positions.

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Your Sector ChoicesShows you the Sector and Industry you’ve chosen. To change the Sector, click the “Change Sector” button. To change the Industry, click the “Change Industry” button.

Your Investing SizeChoose your portfolio and individual investment size.

Find Open PositionsClick the “Find Open Positions” button to view a list of stocks currently in Open Positions.

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Viewing Open PositionsOnce you’ve selected your options, you’ll be shown a list of stocks in Open Positions. Once again, this list is very similar to those you’ll see using the Simple Scan tool, so we’ll only be covering them briefly in this tutorial. For more information on viewing Open Positions, please see our tutorial, Simple Scan for Stocks: Viewing Open Positions.

1 Performance scorecard


2 List of open positions

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Switching between Open Buy and Sell PositionsThe Wizard lets you view both Open Buy Positions and Open Sell Positions.

View Open Buy PositionsClick on the “View Open Buy Positions” tab.

View Open Sell PositionsClick on the “View Open Sell Positions” tab.

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The Open Positions ListMost of these columns are covered in detail in the tutorial, Simple Scan for Stocks: Looking for Buy and Sell Signals. Please view this tutorial for more information.

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Stock Symbol and Name

Trend of that stock

Sector/Industry

Days held / Entry Date

Last Price of that stock

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Entry Price of that Stock

Stop Price

Profit Targets

Profit/Share for that stock9

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Performance ScorecardThe Wizard will also show you an Investment Scorecard, which details the performance of the entire list of Open Positions.

Summary of your options

Including your Sector and Industry choices.

Winning Signals vs. Losing Signals

Percent Winners

Average and Margin Profit

Investment Stats

Run a New Sector Scan

Click this button to run a new Sector Scan

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Part 5: Three Strategies forInvesting with SectorsThe three ways of using The Wizard’s Sector Scan


The 3 Strategies for Investing in Sectors and IndustriesThe Wizard offers you three different ways of investing in Sectors and Industries. Each method can be used to buy and sell short.

Strategy 1: The Sector-Industry Complete Strategy

This strategy takes a full, top-down approach to Sector investing. Its 3 steps include:

1. Locating the best Sector.

2. Identifying the best industries within that Sector.

3. Finding the best stocks in those Industries.

Strategy 2: The Sector Only Strategy

This strategy does not look at specific Industries and involves just two steps:

1. Identify the best Sector.

2. Identifying the best stocks within that Sector.

Strategy 3: The Industry Only Strategy

This strategy does not look at specific Sectors and also involves two steps:

1. Identify the best Industry.

2. Identifying the best stocks within that Industry.


Strategy 1: The Sector-Industry Complete StrategyThis Sector-Industry Complete strategy gives you the most complete view of The Wizard’s Sectors and Industries. With this strategy, you will take a full top-down approach, as you pinpoint your investments with each step.

Sector-Industry Complete Buy StrategyUse this strategy to look for stocks to buy.

1 Step 1: Confirm that the Market Trend = BuyThe Wizard will only display Buy Signals when the Market Trend = Buy

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Step 3: View the Industries in the strongest SectorClick the “Industries” button to view the Industries within that Sector.

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Sector-Industry Complete Buy Strategy

4 Step 4: Locate the strongest IndustrySort the Industries list by ranking, from strongest to weakest.

Step 5: View Buy Signals for the strongest IndustryClick the “Buy Signals” button for the strongest industry.

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6 Step 6: Select your Buy Signal OptionsHere, you can review your Sector and Industry choices, choose the Short-Term or Long-Term Time Horizon and select your Investment Size. Once you’ve selected your options, click the green “Find Buy Signals” Button.

For more information on selecting Buy Signal options, please see our tutorial, Simple Scan for Stocks: Finding Buy and Sell Signals.



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7 Step 7: Select the highest ranked stocks to buy.


Sector-Industry Complete Sell StrategyUse this strategy to look for stocks to sell short.

1 Step 1: Confirm that the Market Trend = SellThe Wizard will only display Sell Signals when the Market Trend = Sell

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Step 3: View the Industries in the weakest SectorClick the “Industries” button to view the Industries within that Sector.

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Sector-Industry Complete Sell Strategy

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4 Step 4: Locate the weakest IndustrySort the Industries list by ranking, from weakest strongest.

Step 5: View Buy Signals for the weakest IndustryClick the “Sell Signals” button for the weakest industry.

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6 Step 6: Select your Sell Signal OptionsHere, you can review your Sector and Industry choices, choose the Short-Term or Long-Term Time Horizon and select your Investment Size. Once you’ve selected your options, click the red “Find Sell Signals” Button.

For more information on selecting Sell Signal options, please see our tutorial, Simple Scan for Stocks: Finding Buy and Sell Signals.



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7 Step 7: Select the highest ranked stocks to sell short.


Strategy 2: The Sector Only StrategyThis Sector Only strategy takes you directly to the best stocks within the best sector. This strategy does not pinpoint the best industries, opting to look for stocks directly within a sector.

Sector Only Buy StrategyUse this strategy to look for stocks to buy.


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Step 3: View Buy Signals for the strongest SectorClick the “Buy Signals” button for the strongest Sector.

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Sector Only Buy Strategy

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5 Step 5: Select the highest ranked stocks to buy.


Sector Only Sell StrategyUse this strategy to look for stocks to sell short.


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Step 3: View Sell Signals for the weakest SectorClick the “Sell Signals” button for the strongest Sector.

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Sector Only Sell Strategy

Step 5: Select the highest ranked stocks to sell short.


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Strategy 3: The Industry Only StrategyThis Industry Only strategy takes you directly to the best stocks within the best industry. This strategy does not pinpoint the best sectors, opting to look for stocks directly within an industry.

Industry Only Buy StrategyUse this strategy to look for stocks to buy.

1 Step 1: Click the “View Industry Rankings” tab to see a list of all industries.

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Industry Only Buy Strategy


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Step 3: Locate the strongest IndustrySort the list of Industries by ranking, from strongest to weakest, and select the strongest Industry.

Step 4: View Buy Signals for the strongest IndustryClick the “Buy Signals” button for the strongest Industry.

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Industry Only Buy Strategy

Step 5: Select the highest ranked stocks to buy.


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Industry Only Sell StrategyUse this strategy to look for stocks to sell short.

1 Step 1: Click the “View Industry Rankings” tab to see a list of all industries.

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Industry Only Sell Strategy


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Step 3: Locate the weakest IndustrySort the list of Industries by ranking, from weakest to strongest, and select the strongest Industry.

Step 4: View Sell Signals for the weakest IndustryClick the “Sell Signals” button for the weakest Industry.

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Industry Only Sell Strategy

Step 6: Select the highest ranked stocks to sell short.


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