Screening Chinese Stocks by Amplitude, Free Float, and Positive P/E

Summary

The proposed stock screen combines three conditions: prior-day price amplitude above one percent, free-float shares no greater than 5.5 billion, and trailing P/E above zero. It describes the amplitude condition as a way to find active, volatile shares, the float limit as a small-cap filter, and positive P/E as a means of excluding loss-making companies. The examples show the criteria combined and suggest ranking qualifying names by turnover when limiting the final list.

The document reports no backtest, returns, or risk-adjusted results, so it does not establish that the screen has investment value. It acknowledges that the rules omit other financial and business fundamentals, growth prospects, sector context, and market conditions. It suggests adding financial measures and periodically reassessing the rules, but does not specify thresholds or a tested rebalancing method. The selection criteria are therefore a basic screening proposal rather than a validated trading strategy.

Key ideas

• The screen requires amplitude above one percent, free float at or below 5.5 billion shares, and positive trailing P/E.
• The criteria aim to identify active small-cap stocks with positive earnings.
• Turnover is suggested as a way to rank qualifying names when selecting a limited group.
• The article provides no performance testing and notes that the screen omits broader fundamentals and growth factors.
• It recommends adding financial and sector analysis and reviewing the rules as conditions change.

Tags

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