Screening Profitable Small-Cap Stocks Above the 250-Day Average

Summary

The document describes a stock screen combining four conditions: daily high-low amplitude of at least one percent, positive net profit, market capitalization no greater than 10 billion yuan, and a closing price above its 250-day moving average. It frames the filters as a way to find relatively volatile, smaller companies with positive earnings and a longer-term upward price trend. The article also sketches implementations in a Chinese charting formula and Python using market data.

It cautions that emphasizing short-term volatility may overlook longer-term changes and that one technical indicator may not capture the full trend. Suggested refinements include adding indicators, comparing the criteria on historical data, and reviewing company fundamentals. No backtest results, portfolio rules, transaction costs, or risk-adjusted returns are supplied, so the rationale is qualitative and the screen alone does not demonstrate predictive value. The stated thresholds describe the proposed filter rather than validated performance.

Key ideas

• The screen requires daily price amplitude of at least one percent and positive net profit.
• It limits market capitalization to 10 billion yuan and selects stocks above their 250-day moving average.
• The article associates the moving-average condition with an upward trend and the amplitude condition with short-term volatility.
• It recommends historical comparison, additional indicators, and fundamental review as possible refinements.
• No evidence is provided that the screen produces profitable or risk-adjusted returns.

Tags

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