Screening Small-Float Stocks with Turnover and a Morning Star Pattern

Summary

The document outlines an equity screen combining turnover, circulating market capitalization, and a morning star candlestick pattern. Its stated criteria use a turnover range of 3% to 12%, a circulating share count cap of 5.5 billion shares in the headline, and a morning star pattern on the current day. Later passages refer instead to circulating market value at or below 5.5 billion, which is a different measure. The text also suggests adding fundamental and growth measures, such as valuation and earnings growth, to widen the analysis beyond short-term technical conditions.

The article warns that a screen based only on technical patterns may overlook business quality and long-term prospects. Its formula examples are inconsistent: one uses a turnover threshold that does not match the stated range, and the Python example has contradictory lower and upper bounds. No backtest or realized performance evidence is included. These discrepancies make the exact screen uncertain, and the proposed pattern should not be treated as proof of future gains.

Key ideas

• The screen combines turnover, a circulating-size measure, and a morning star pattern.
• The stated turnover range is 3% to 12%, but an example does not implement that range consistently.
• The document alternates between circulating share count and circulating market value limits.
• It recommends considering fundamental and growth measures alongside technical conditions.
• No backtest or performance evidence is provided.

Tags

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