A Chinese Stock Momentum Screen Using MACD, Rising Averages, and Size
Summary
This screening method combines three conditions for Chinese stocks: MACD above zero, a rising short-term moving-average pattern, and company scale above 200 million. The document interprets these as signs of positive momentum and an upward trend, with a size threshold intended to favor larger firms. It also describes sorting qualifying stocks by trading volume and gives indicator definitions and sample screening logic.
No performance statistics or backtest evidence are provided. The cautions note that larger companies are not necessarily more profitable, rising stocks can still carry risk, and the screen may retain weak businesses or fail to prompt timely exits. Suggested refinements include incorporating profitability growth and return on equity, alongside continued review of holdings; these refinements are not evaluated in the document.
Key ideas
- The screen requires MACD to be above zero and a rising short-term moving-average pattern.
- It adds a company-scale threshold of 200 million.
- The example ranks selected stocks by trading volume.
- The document offers no reported performance test for the screening rules.
- It warns that size and recent price strength do not guarantee future returns.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.