Combining MACD, Moving Averages, and Revenue Growth in Stock Screening

Summary

The document describes a Chinese stock screen that combines three conditions: MACD above its zero axis, a 20-day moving average above the 120-day average, and revenue growth between 2018 and 2021 exceeding a stated ratio threshold. It frames MACD and the moving-average relationship as trend or momentum filters, while the revenue comparison is intended to capture business growth. The accompanying example also describes market-cap screening, selecting stocks, and holding a limited number of positions, with a cost-basis stop rule.

The article identifies several limitations: revenue alone omits profitability and other fundamentals, MACD can lag, two moving-average horizons may miss abrupt moves, and results may vary by industry and market regime. It suggests adding financial and technical measures and adapting criteria by sector or conditions. The content does not provide backtest performance or establish that the proposed filters predict returns. Its code and prose also differ slightly in describing the revenue condition, so the precise screening rule should be checked before use.

Key ideas

• The proposed screen combines a positive MACD condition, a short-versus-long moving-average trend filter, and multi-year revenue growth.
• The article discusses market capitalization screening, a capped portfolio, and a stop rule as implementation elements.
• Revenue growth alone may omit profitability and other relevant company information.
• Lagging indicators, limited trend horizons, and sector or regime differences can affect the screen.
• The document provides no performance evidence, and its written and coded revenue criteria are not fully consistent.

Tags

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