Chinese Stock Screen for Three-Day Declines and Shareholder Control

Summary

This post describes a short-term Chinese equities screen combining three conditions: daily amplitude above 1, a daily controlling-shareholder measure with an absolute change above 21, and three consecutive daily declines in closing price. It frames the setup as a potentially aggressive reversal screen, on the premise that a recent decline combined with the other filters may identify candidates for further review. Example formula and Python snippets show how to apply the conditions and rank selected stocks by funds-flow ranking.

The post warns that a technical screen can miss company fundamentals and broader market or micro-level risks. It suggests adding fundamental measures such as cash flow, profitability, and competitive position, and using risk controls rather than focusing only on returns. No backtest results, transaction-cost estimates, or evidence that the screen predicts reversals are supplied. The shareholder-control metric and example implementation also depend on platform data definitions, so the screen requires verification before practical use.

Key ideas

• The screen requires amplitude above 1, a controlling-shareholder measure change above 21 in absolute value, and three consecutive lower closes.
• The post characterizes the combination as an aggressive short-term reversal candidate filter.
• An example implementation ranks qualifying stocks by a funds-flow measure.
• The author recommends considering fundamentals and managing risk alongside technical conditions.
• The document provides no backtest or evidence establishing predictive performance.

Tags

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