Screening Shenzhen Main Board Stocks by Capital Flow and Valuation

Summary

This note describes a Chinese equity screen that ranks Shenzhen Main Board stocks by capital-flow strength and applies price-to-earnings and price-to-book limits. Its initial criteria set the P/E range below about 29 and P/B below about 3.1. The accompanying explanation treats stronger inflows as a sign of market attention and the valuation bounds as a way to focus on comparatively lower-valued companies.

The author flags that narrow valuation ranges may exclude candidates, that the capital-flow measure may be inaccurate, and that the selected board may have weaker liquidity or scale than other segments. The proposed revision broadens the valuation ceilings to 50 for P/E and 5 for P/B and suggests filtering by company size and liquidity. No performance data or test results are supplied, and the post does not define how capital-flow strength is calculated. Its final size and liquidity criteria are also incomplete.

Key ideas

• The screen ranks Shenzhen Main Board stocks by capital-flow strength.
• The initial valuation filters cap P/E near 29 and P/B near 3.1.
• The author proposes broader valuation limits and additional size and liquidity filters.
• The post provides no backtest evidence and does not specify the capital-flow calculation.

Tags

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