Screening Low-Priced Small-Cap Stocks by Range and Profitability

Summary

This Chinese A-share screening note selects companies with a daily high-low range of at least one percent, positive net profit, market capitalization no greater than 10 billion yuan, and a share price below 12 yuan. The proposed rationale is to combine short-term movement with smaller company size and positive earnings while focusing on lower-priced shares. The document provides example formula and Python references for applying these filters, but reports no backtest, selected-stock examples, or return evidence.

The author warns that low share prices can distract from a company’s fundamentals and that such stocks may be volatile. The note suggests assessing additional measures, including valuation, return on equity, and trading volume, and considering company value alongside the price cutoff. The screen is a basic candidate-generation rule; the document does not define the measurement period for profitability or market capitalization, explain portfolio construction or exits, or demonstrate that the filters identify undervalued or higher-growth companies.

Key ideas

• The screen requires a daily high-low range of at least one percent and positive net profit.
• It limits market capitalization to 10 billion yuan and share price to below 12 yuan.
• The proposed rationale combines short-term movement, smaller company size, profitability, and a low nominal share price.
• The author cautions that low prices can obscure fundamentals and that the selected stocks may be volatile.
• Suggested additional filters include valuation ratios, return on equity, and trading volume; no performance evidence is supplied.

Tags

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