A Three-Filter Process for Screening High-Volume Momentum Stocks
Summary
The document describes a daily process for building a short-term stock watchlist. It starts by ranking stocks by traded value and keeping the top 50. It then removes stocks that gained less than 5% that day, those whose 30-day moving average is flat or declining, and those with negative net assets in the latest year. The stated rationale is to focus on active trading, upward price movement, and a basic balance-sheet filter.
The method is presented as a repeatable screening routine: update the list after each close, dropping stocks that no longer qualify and adding new ones that do. The article offers no backtest, performance data, or evidence that the filters predict future returns. Its account of a trader growing capital from 3 million to 40 million in a year is an unattributed promotional claim, not substantiated analysis. The rules are also market-specific and omit entry timing, exits, sizing, transaction costs, and risk controls beyond the net-asset screen.
Key ideas
- Rank stocks by traded value and begin with the top 50 after each close.
- Require a daily gain greater than 5% and a rising 30-day moving average.
- Exclude stocks with negative net assets in the latest year.
- Refresh the candidate list daily as stocks enter or fail the filters.
- The document provides no testing evidence or detailed trade and risk rules.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.