Chinese Stock Screen for Five-Year ROE and Positive P/E

Summary

This document presents a Chinese equity selection rule that combines price range with profitability and valuation filters. It selects stocks whose intraday high-low range exceeds the stated threshold, whose return on equity has remained above the stated level for five consecutive years, and whose price-to-earnings ratio is positive. The stated rationale is to pair recent price activity with a sustained record of profitability and current positive earnings valuation.

The post provides indicator and Python examples for applying the filters, but it offers no backtest, returns, or other evidence that the screen predicts future performance. It also flags that the rule may ignore market trends and other company conditions, and that a positive P/E requirement alone does not establish long-term value. Additional fundamental, valuation, liquidity, and safety-margin checks are suggested. The source's code and explanation contain some ambiguity around thresholds and data handling, so the criteria would need validation before use.

Key ideas

• The screen requires a minimum intraday price range, sustained high ROE, and a positive P/E ratio.
• The ROE condition is intended to favor companies with a multi-year profitability record.
• The document supplies sample implementations but no performance testing or investment results.
• The rule omits broader market and company factors, and positive P/E alone does not establish value.

Tags

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