Screening for Chinese Stocks with Strong ROE and Rising Price Trends

Summary

This stock-screening idea combines price range, profitability, and trend conditions. It looks for shares with an intraday high-low range greater than the 14-period average true range, return on equity above 15% in each of the prior five years, and a bullish moving-average alignment: the 5-period average above the 15-period average, above the 30-period average, with price above the 60-period average. The intended market is Chinese equities.

The document frames the conditions as a way to find companies with sustained profitability and upward price movement, while acknowledging that the screen may omit relevant market and company information. It suggests adding measures such as trading volume, valuation, and industry or financial context, and checking technical signals with other indicators. It provides example formulas but no historical test, portfolio results, or evidence that the selection rules predict future returns. The range condition is also described imprecisely as moderate volatility even though it requires a range above ATR.

Key ideas

• The screen combines a daily price-range condition with a five-year ROE filter.
• It requires ROE to exceed 15% in each of five years.
• A bullish moving-average sequence and price above the 60-period average represent the trend condition.
• The author suggests adding valuation, volume, industry, and other company information.
• No backtest or performance evidence is reported, and the price-range rationale is not fully defined.

Tags

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