Using an ETF Screener on TD Ameritrade

Updated : Oct 25, 2019 in Articles

Using an ETF Screener on TD Ameritrade

Hi this is Rebecca, welcome to Squintillions! In this video I’m going to demonstrate the ETF screener at TD
Ameritrade before we get started I’m going to share some background
information I have my IRA at TD Ameritrade as well as custodial accounts
for each of my two sons. In mid-may I decided to open a trust account with TD
Ameritrade because I received a large check that I wanted to invest. Opening a
new account allowed me to get a deal of 500 free trades for 60 days
which gives me time to invest this money without paying commissions. My plan for
this account is to treat it like a foundation, where I don’t touch the
principal — though I’m not actually doing the paperwork to create a foundation and
I don’t have the legal obligations of a foundation.
I’d like to use 50% of the money that I gain from dividends and interest each
year as charitable contributions for my favorite nonprofit organizations, in the
following year. The rest of the earnings will cover taxes and be reinvested. If
you support this idea hit the LIKE button and SUBSCRIBE if you want to
follow along on my journey. I’m mostly looking for investments that pay great
dividends or solid companies with some dividends and good growth potential. I’m
primarily looking to invest in ETFs (exchange-traded funds) to spread the risk. I’m selecting the ETF’s I am interested in and setting up limit
orders at prices that I believe the funds might dip down to in the next
month. If an order doesn’t go through, I will reevaluate in a few weeks and
either adjust the order price or or make a different investment selection. Now
let’s get started with the ETF screener. The ETF screener is under the Research
and Ideas heading and then you go down to Screeners and you select ETFs. They
also have screeners if you want to do stocks, options or mutual funds. So we
click on ETFs and we’re going to go to “create a screen.”
On the left there is a menu of categories with drop-down boxes allowing
the user to choose specific criteria. I’m going to set up the criteria with the
minimums that I would consider for each category. When you choose your own ETFs
you may want to make different choices based on your financial goals, risk
tolerance, and your investment timeline. Let us start on the overview tab. I’m
going to click the box for ETF type. I would choose equities, sectors or
internationals, I am NOT interested in bonds or commodities for this account. So
now that’s already narrowed it down to 1752 matches. The next thing I’m going to do is the gross expense ratio. I’m going to
enter a specific value — so I want the expense ratio, this is basically the cost
of owning the fund, to be less than or equal to 0.45 percent. That eliminated
quite a few options which is fine because I’m trying to get fewer ETFs to
select from. The reason I’ve put the gross expense ratio at .45%
is that I strongly dislike giving my money away in fees and when
there are so many lower cost ETFs available that will meet my needs, I
don’t see the point in paying a higher expense ratio. Next I’m going to scroll
down these categories to dividends because that’s important for this
account. I’m going to start with distribution yield and enter a specific
value and I want my distribution yield to be greater than or equal to 2.2%. You can see they’ve listed the average here as 2.16% and I wanted to do that or better. I’m going to do the dividend
12-month totals and this I want to be greater than a dollar per share. And now
you can see how it’s narrowing down here on the right
side, I’m down to 143 matches. The next thing I’m going to look at is price. I’m
going to select current price and then again enter a specific value I like my
price to be less than $200 this is a personal preference because I like to
reduce the risk of a large per share loss so I like my prices to be under
$200 per share next I’m going to look at performance I’m going to select total
net assets and again I’m going to enter specific values. You’re welcome to choose from the options they give you. I’m going to have this greater than fifty million —
50,000,000. I decided to create a minimum total net
asset screen to weed out some of the smaller ETFs. Now I’m going to look at
ratings and risk, selecting the box for beta, and I’m going to enter a specific
value and I’m going to do less than or equal to 1.2. I’m looking for ETFs with
lower volatility so I added beta to the criteria. I wanted to exclude any ETFs
that hold riskier or less proven companies — considering the beta for some
of the established tech companies like Apple and Facebook are in the 1.2 to 1.4
range I figured that even though such companies are above the beta I chose,
they may still be included in the ETF’s because less volatile companies will
also be included to help lower the overall beta figure. Finally I’m
selecting the Morningstar star rating and I’m going to choose five star, four
star, and three stars, and now I’m down to 45 ETFs. Let’s run that and view the matches.
This is the list of ETFs that the screener came up with. This is the first
25 we got: IUSV at the top, VTV, VEA, VYM, MGV. I’m going to also show you the
second page of that, and here we go. When I previously ran the screen the number
of ETFs left was 82. I downloaded a spreadsheet with the 82
ETFs that passed the screening criteria and that’s what this is — the next step is
how would I look at this data in order to narrow it down further.
I looked at the ETFs that you’re seeing on this spreadsheet on May 27th and 28th
of 2019 so numbers and prices on here are from those days. I thought I had (previously) set
up the ETF screener to include ETFs with Morningstar ratings of 5, 4, or 3 but
there were 4 ETFs included on my list that had a star rating of 2, so I
removed those first once I started working on the spreadsheet. And here’s
the full list that was downloaded when I previously ran the screen. This downloaded spreadsheet didn’t
include the dividend cash amount or the distribution yield so I ended up adding
those columns later. So I started working on it; this is what I have — since
generating dividends is important to this account the first thing I did was
remove all of those ETFs with yields that were less than 2.5 percent which
left me with 57 ETFs and that’s where we were on this spreadsheet.
Another factor I like to consider when focusing on dividends is figuring out
how much a set amount of money invested would return on dividends for one year. I
typically use the figure of $10,000. I like knowing a monetary figure, that
allows me to more concretely compare different investments than just looking
at the yield percentage. It’s a trick that makes more sense to me maybe it
will help others out there too. I explain it in more detail on the Squintillions
website, so check the description below for direct links. You can see where I’ve
added those columns in: the number of shares you can buy for $10,000 and the (estimated) dividend you can get (in a 12 month period) for $10,000 worth of shares. I
also added some other columns to the spreadsheet to help me make my decision
on which ETFs I would like to invest in: the 52-week price range, and I also
updated the current price on the day that I was looking at these ETFs more
closel,y and another column that I added was the 1-year market return. I began to
look this up for each ETF individually using the resources on TD Ameritrade. I
entered the 1-year market return percentage on the spreadsheet if it was
over 8% or close to 8% as there’s one what 7.73 % and the return since
inception was also over 7%. I didn’t add that column to the sheet I just looked
at it when I was removing ETFs and I deleted any of
the ETFs that didn’t meet those qualifications. I excluded these two
REITs from the qualification of having over 7% returned since inception as they
have such a high return for this past year and I’m wanting to invest in a
couple REITs or maybe just one of them as part of the diversification of this
portfolio. So now this is the list that I ended up with — it is much more manageable
at 20 some ETFs. I like to read about the funds — I usually check out the Seeking
Alpha website. I’m just going to go over there and search for one of the funds
which is HDV iShares Core High Dividend ETF as my example. I look at what they
have here on the summary, I click through the different headings I read what they
have as the strategy, I look at the key data and I also double check on the
dividends ,and I look at the dividend history, and see that this is pretty
consistent. And then I also like to look at the holdings. I like to find out how
many holdings are in the ETF — this one has 78 — and I like to see what the top
ten companies are. Here we’ve got ExxonMobil, JPMorgan Chase, Verizon, etc.
I’m not going to read them all but one thing that’s interesting about this ETF
is that their top 10 Holdings make up 57.64% of the ETF and another thing
about the holdings is there are some companies that I prefer not to invest in
or to minimize my investments from a values standpoint, such as I like to
minimize my investment in Big Tobacco so I try to not have Big Tobacco on here
or if there is Big Tobacco, I like it to be
less than 2% of the investment. I will also skim any recent articles
that mention the ETF, I don’t have a subscription to Seeking Alpha yet, so
there’s some articles that are locked to me, but there’s a recent one here: “HDV
Plan For an Energy Rebound,” so if you haven’t used Seeking Alpha before, the
articles are really usually well written they give you a little summary at the
top, they give you the main argument, they almost always have some sort of chart,
then there’s usually some interesting comments below
about what people think about the article. And that’s just part of my
research process. After doing this whole process I’m left with these 21 ETFs from
the screen. What further criteria might I look at? Which ones would you pick? Let me
know in the comments below. I have invested in three of the ETsF so far but
I’m still looking at picking another handful. I’ll share which ones I selected
at a future date when my other investments have been made. Remember to
hit the like button if you haven’t already and subscribe for more content,
hit the notification bell if you don’t want to miss any of my videos as I
currently post at random! Don’t forget to check out the Squintillions website
where I post about once per week about personal finance and personal growth.


  • Great overview of TD Ameritrade!

    When showing a screen, I had similar issues as well. It's hard to get the screen legible on videos so I stopped doing that.

  • Nice video. Every month I compare our youtube portfolio against the etfs SPY, QQQ, VGT, IGM which I think r probably the best and safest etfs

  • You should consider using m1 finance. They offer IRAs and free trading (as far as I know). I just use Robinhood as I don't have a tax advantageous account.

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