Staying organized is one of the more important parts of your trading endeavors. It is quite easy to find yourself amazed by all the offerings of your trading platform and want to have every bell and whistle showing on your screen. If you are really diving in then it is very likely you have found yourself with a series of screens, all so you never miss a thing right? From charting to quotes, option chains and watch lists you have it all ready to go, but there is one place that traders tend to go a little crazy and that is with the watch lists.
Let's face it, you can't watch everything all the time. This is one of the reasons that many traders will tell you to develop a small list of "go-to stocks" that you find success with and enjoy the general movement of. Almost every trader I know has this list. I call mine "cheese" referring to the mouse in the maze that eventually finds his reward...the cheese. While this list of stocks are my go to stocks, there are many times that potential trades are setting up on other names. It could be earnings related or a favorite technical pattern. This list I call "potential" as they may not quite be ready but I suspect that there is potential for a future trade.
There is no need to have the "potential" watch list up at all times. It is stored in the software and I add to it when something catches my eye. A few times a week I will make it my homework to dig through each name on this list to see if the potential I once saw is still there. This list is also frequently less than 10 stocks.
Finally, I have all the major indices on their own watch list. The S&P 500, and the Nasdaq 100 each with their own list. Though I will not trade many of the names in these sectors (because of lower volume, low volatility, etc) I still like to breeze through them from time to time to see what pops up near the top and bottom. With this scan I can pick up on trends like auto part retail stocks being in the top performers for multiple days in a row.
The lesson today is to keep only a few watch lists prepared so you are organized in a way that helps you trade, scan and prepare for future trades. The market provides opportunity every second of every trading day, but that doesn't mean you need to take it all!