What is the 'Watch List'
1. A list of securities being monitored closely by a brokerage or exchange in order to spot irregularities. Firms on the watch list might be suspected of regulatory violations, about to issue new securities, attracting usually heavy volume, etc.
2. A list of securities being monitored for potential trading or investing opportunities. An investor or trader may have a watch list of several, dozens or even hundreds of trading instruments. The investor waits for certain criteria to be met--such as trading over a certain volume, breaking out of a 52-week range or moving above its 200-day moving average--before placing trade orders.
Also called a grey list.
BREAKING DOWN 'Watch List'
1. A watch list is a used to specify companies where irregularities are present, or where the potential for insider trading or other corruption exists. The watch list can be considered a surveillance tool used to identify risks from customers, consultants, suppliers and other business partners.
2. Many trading platforms give investors and traders the opportunity to create watch lists and screen, or filter, for certain conditions to be met. The user can specify both fundamental and technical criteria in an attempt to find high probability trading or investing opportunities. The watch list may provide an alert, such as an audible alert, text message or email, that warns the user that conditions are about to be met or have been met.