Combining RSI, Industry Concentration, and Dividend Screening

Summary

This A-share selection rule combines a relative strength index below 65 with an industry concentration measure above 70% or below 20%, plus a dividend payout ratio above 25% for 2019. The post frames the approach as combining a technical condition with a historical shareholder-return measure, and provides formula and Python examples. It also describes ranking a limited set of stocks by circulating market capitalization before applying the conditions.

The article gives no backtest, portfolio returns, or evidence that the conditions predict future performance. It highlights reliance on old data, changes in market and macroeconomic conditions, shifts in dividend policy, and a potentially small candidate set that could limit diversification. It suggests adding valuation, asset quality, earnings growth, industry balance, and risk controls, but does not specify or test those refinements. The industry concentration condition and examples would need clarification and data validation before interpreting the screen as a reproducible strategy.

Key ideas

• The proposed screen pairs RSI below 65 with an extreme industry concentration reading and a historical dividend threshold.
• The dividend condition refers specifically to 2019, so its relevance may decline as newer information becomes available.
• Example code also limits the initial candidate set by market capitalization before applying the conditions.
• The post provides no measured returns or backtest evidence for the selection rule.
• A narrow set of qualifying stocks may leave the portfolio concentrated across industries or issuers.

Tags

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