Combining High ROE, Price Range, and KDJ Signals for Stock Selection

Summary

The post proposes a stock screen combining a daily high-low range threshold, a history of strong return on equity, and a newly formed KDJ turning signal. It interprets the range condition as a volatility filter, the profitability condition as a quality screen, and the KDJ pattern as a possible early indication of rising prices. It supplies illustrative formula and Python snippets for applying the conditions, but the examples contain placeholders and do not establish a complete, validated implementation.

The author acknowledges that a KDJ turn may be temporary, that a narrow set of accounting measures can miss company-specific issues, and that consistently high-ROE firms may be scarce. Suggested refinements include adding valuation or other technical measures and confirming the signal with another indicator. No backtest, benchmark, transaction-cost analysis, or evidence of predictive performance is provided, so the screen should be treated as a proposed rule rather than a demonstrated strategy.

Key ideas

• The proposed screen combines price range, multi-year ROE, and a KDJ turning pattern.
• The post treats profitability as a fundamental filter and KDJ as a technical timing signal.
• It suggests confirming the signal with additional technical or valuation measures.
• The code examples are illustrative and include unspecified conditions.
• No performance testing is presented, and the listed risks include transient signals and narrow fundamental coverage.

Tags

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