Stock Scanner: How Traders Filter
5,000 Tickers in Seconds
A stock scanner is software that monitors exchange-listed equities in real time and surfaces only the symbols that match criteria you define. Instead of scrolling price lists manually, you set numeric rules (price above $2, volume over 500,000 shares, float under 20 million) and the scanner does the heavy lifting. This article explains what scanners do, how they work, and how to use one without drowning in false positives.
Last updated: 15 October 2026 · Educational, not financial advice.
What a stock scanner actually does
Every trading day roughly 5,000 US-listed common stocks change hands. A scanner watches the data feeds (price, volume, percent-change, float, market cap, sector tags) and compares each ticker against your filter criteria every few seconds. When a stock meets all the conditions at once, the scanner displays it in a results table, often with an audible alert.
Scanners do not predict direction or tell you what to buy. They simply answer the question: which symbols right now satisfy this rule set? You still need a method to decide whether the filtered results are worth a trade, what size to take, where to stop out, and when to exit. The scanner's job ends at the filter stage.
Most platforms offer pre-built scan templates (gap-up, volume spike, new high) and let you clone or edit them. Advanced users build multi-condition scans that stack price, volume, float, relative-volume, and technical-indicator thresholds to narrow the universe down to a handful of candidates each session.
Common scan criteria and what they mean
Here are the most widely used filters, written in plain English:
- Price range: Exclude penny stocks below $1 or blue chips above $50 if your strategy targets small caps.
- Volume: Minimum shares traded today (often 100k or 500k) to ensure you can enter and exit without slippage.
- Relative volume: Today's volume divided by the 30-day average; a value above 2.0 flags unusual activity.
- Percent change: Stocks up or down more than X% since the open or previous close.
- Float: Shares available for public trading; low-float explainer stocks (under 20 million) can move faster on the same dollar volume.
- Market cap: Total value of all shares; micro caps are under $300 million, small caps $300m to $2 billion.
- Average True Range (ATR): Measures daily volatility; higher ATR means wider swings.
- Technical patterns: Moving-average crosses, RSI thresholds, VWAP tags, or breakout signals.
Each condition you add shrinks the result set. A scan with ten strict filters might return zero matches on a quiet day; two loose filters might flood you with hundreds of tickers. Balance is iterative.
Real-time versus delayed data
Free scanners typically show data delayed by fifteen or twenty minutes. For end-of-day swing trades that delay is tolerable; for intraday setups it can be fatal. A stock that spiked at 10:03 may have already retraced by the time your delayed scan flags it at 10:18.
Real-time scanners pull live quotes from exchange feeds and refresh every few seconds. Subscription cost varies: some brokers bundle live scanning with an active account, standalone platforms charge $30 to $200 per month depending on feature depth and the number of simultaneous scans you can run.
If you trade on five-minute or fifteen-minute charts, real-time data is the baseline. If you scan once at the close and execute the next morning, delayed data will usually suffice. Match the tool's latency to your hold period.
Building your first scan (step by step)
Open your platform's scan builder and follow this sequence:
- Pick the universe: all US common stocks, or narrow to a specific exchange (NASDAQ, NYSE) or exclude ETFs and warrants.
- Set a price floor and ceiling that match your account size and risk tolerance (for example, $1 minimum to dodge sub-dollar volatility, $20 maximum to stay in small-cap territory).
- Add a minimum daily volume filter (start with 100,000 shares) so you have liquidity to exit.
- Layer on one catalyst filter: percent-change above +5% today, or relative volume above 2.0, or a technical breakout.
- Run the scan mid-morning (10:00 to 11:00 ET) when the opening scramble has settled but the session still has runway.
Review the results manually. Check the chart for clean structure, read the news tab for catalyst, verify the float and outstanding-share count. A scanner will return stocks that meet the math; only you can judge whether the setup makes sense. Write down why you passed or took each result so you can refine the filter over time.
Common mistakes and how to dodge them
Too many conditions. Stacking eight filters may feel rigorous, but if nothing passes the scan for three days running you learn nothing. Start lean, add one rule per week as you spot recurring false positives.
Ignoring the why. A stock can gap up 30% because of an FDA approval or because a single market order hit a thin book at the open. The scanner shows the move; the context decides whether it is tradable. Always check news and time-and-sales before acting.
Chasing the alert. By the time the scanner beeps, early traders may already be taking profit. If the entry you planned is 10% away, the risk-reward has shifted. Wait for a pullback or skip the trade.
No exit plan. A scanner finds entries, not exits. Decide your profit target and stop-loss before you enter, or the emotional cost of a red candle will override your rules. Ignition Alerts, for example, uses fixed thresholds: half at +50%, the rest at +100%, stop at -25% until the first half sells. You need equivalent clarity, whether discretionary or mechanical.
Where Ignition Alerts fits
Ignition Alerts is a rule-based scanner service for US small caps. Every afternoon at 3:30 ET it applies two fixed tests to the tape, buys up to twenty passing symbols at 5% position size each, and emails every entry with ticker, price, and the logic that triggered it. Exits follow the same mechanical thresholds: half at +50%, remainder at +100%, stop at -25%, and anything left closes on the tenth session. 22 trades have closed green to date (best: LHSW +249% from $1.75), every trade published, losses included, at the complete public track record. Past results are not a promise.
The service does not offer stock picks or personalised advice. It sends you the same alert it trades, in real time, so you can paper-trade the method, learn how the method works, or mirror it in your own account if the risk fits. It is designed for people with a day job and fifteen minutes of evening screen time. If you prefer to build and tune your own scans, Ignition is not a replacement; if you want a second-income stream that runs on published rules with every winner and loser on the record, compare it against other options in the alert-services comparison.
Next steps
If your broker or charting platform includes a scanner, open it and run the default "unusual volume" or "percent gainers" preset during the first hour of trading tomorrow. Watch how many results appear, pick three at random, and review their charts and news. Notice which tickers had a clear catalyst and which were noise. Repeat for three sessions without trading a dollar.
Once you can articulate why you passed on nineteen out of twenty scan results, tighten the filter to surface fewer, higher-probability candidates. Test on paper, log every hypothetical entry and exit, and track win rate and average gain versus average loss. Only when the paper log shows net profit over thirty trades should you risk real capital, and even then start with the smallest position size your broker allows.
Scanners compress research time; they do not eliminate the need for judgment. Used well, they let you focus your fifteen available minutes on the three setups that matter instead of the 4,997 that do not.
- A stock scanner filters thousands of tickers against rules you set, surfacing only the symbols that meet all conditions at once.
- Scanners do not predict direction; they compress research time by showing you what is moving, not why or whether to trade it.
- Start with loose filters (price, volume, percent-change), run the scan on paper for a week, then tighten rules as you learn which results are noise.
- Real-time data matters for intraday setups; delayed feeds work for end-of-day scans and next-morning entries.
Risk disclaimer: low-float and micro-cap stocks are among the most volatile, illiquid securities in the market; total loss is possible and nothing in this article is financial advice. Ignition Alerts is a research tool - it never tells you to buy or sell. Read the full risk disclosure.
Frequently asked questions
Do I need to pay for a stock scanner?
Many brokers include basic scanning tools for free if you hold an active account. Free web-based scanners exist but usually show delayed data. If you trade intraday and need real-time alerts, expect to pay $30 to $200 per month depending on the feature set and number of simultaneous scans.
Can a scanner tell me which stocks will go up?
No. A scanner filters the market against criteria you define and surfaces symbols that meet those rules right now. It does not predict direction, analyse fundamentals, or guarantee any outcome. You still need a method to evaluate each result, decide position size, and manage risk.
What is the best scan for day trading?
There is no universal best scan because strategies differ. A common starting point is stocks priced $2 to $20, volume above 500,000 shares, relative volume above 2.0, and percent-change above +5% since the open. Run it mid-morning, then review the charts manually for clean setups before taking any trade.
How often should I run a stock scan?
It depends on your strategy. Day traders may scan every fifteen minutes during the session. Swing traders often scan once at the close or before the open. Running a scan more frequently does not improve results if you lack the time to evaluate each alert properly. Match scan frequency to the time you have and the hold period you trade.