A Chinese Equity Screen Combining Turnover, Profit Growth, and Convertible Bonds

Summary

This post outlines a Chinese stock-selection rule that requires turnover between 3% and 12%, year-over-year growth in net profit attributable to parent-company shareholders above 20% and no more than 100%, and a nonempty name for an outstanding convertible bond. The author frames the turnover band as a way to focus on relatively active shares and the profit-growth condition as a profitability filter. The bond-name requirement is included as an additional selection condition, though its investment rationale is not clearly established.

The article includes indicator-formula and Python examples, with the Python sample querying daily market data and profit data before filtering stocks. It proposes adding broader fundamental checks, debt controls such as maturity and repayment capacity, and technical measures such as RSI or momentum. No backtest, return data, or validation of the proposed signals is given. The post also warns that focusing on a few criteria can overlook other fundamentals, and that bond presence alone may not represent the issuer’s debt risk or future earnings outlook.

Key ideas

• Candidates must have turnover between 3% and 12% and profit growth above 20% but no higher than 100%.
• The screen also requires a nonempty name for an outstanding convertible bond.
• The post suggests evaluating debt maturity and repayment capacity to improve the bond-related filter.
• It recommends combining the rule with other fundamental and technical measures.
• The selection logic is presented without backtest results or evidence of profitability.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.