Screening Chinese Stocks by Turnover, Three Down Days, and Buy-Sell Volume

Summary

This stock selection idea combines a turnover range of 3% to 12%, three consecutive declining sessions, and a ratio of external to internal trading volume above 1.3. It aims to find Chinese equities that have recently weakened but may still show buying interest. The article includes formula and Python examples for expressing parts of the screen, though the sample implementation does not consistently apply every stated condition.

The rationale treats the volume ratio as evidence of buyer support, but the article acknowledges that this interpretation can overlook selling pressure. A consecutive-decline rule may also exclude candidates, and the simple indicators may not transfer well across different stocks. It suggests adding company fundamentals and adapting criteria by stock type. No backtest, performance evidence, or execution rules are provided, so the screen is a hypothesis for research rather than a validated trading strategy.

Key ideas

• The screen combines 3%–12% turnover with three consecutive declining sessions and an external-to-internal volume ratio above 1.3.
• The proposed rationale is that elevated external volume may indicate buying interest after a short decline.
• The volume ratio alone can misread order flow and does not establish that selling pressure is low.
• The article recommends considering fundamentals and stock-specific criteria, but provides no performance validation.

Tags

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