Screening Equities with Amplitude, Rising Lows, and Positive P/E

Summary

The document proposes a stock screen that combines price amplitude above one, a rising sequence of recent lows, and a positive price-to-earnings ratio. It presents these as technical and fundamental filters intended to identify shares with substantial movement, improving price structure, and positive earnings valuation. A code sketch gives one interpretation of rising lows using the most recent three observations and suggests checking industry conditions as an additional filter.

The note recommends broadening the fundamental assessment beyond P/E, for example by considering other measures such as book value multiples or return on equity, and incorporating industry or sector strength. It warns that P/E alone may mislead and that technical conditions can change faster than fundamentals. The document supplies no backtest or performance evidence, and its examples do not fully specify the lookback, data definitions, or portfolio and risk rules. The screen should therefore be treated as an illustrative selection idea, not a validated strategy.

Key ideas

• The proposed screen combines amplitude, a sequence of rising lows, and positive P/E.
• The recent low sequence is one suggested way to operationalize the rising-bottom condition.
• The note advises evaluating profitability and valuation with additional fundamental measures.
• Industry and sector conditions are proposed as supplementary selection inputs.
• No performance validation is provided, and the indicators and implementation details require specification.

Tags

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