Screening Stocks by Recent Gains, Long-Term Trend, and Position Changes

Summary

This document describes a stock screen combining three signals: a positive but limited ten-day return, the prior day's price above its 250-day moving average, and a measure of daily position increases above 5%. It interprets the position-change measure as a sign of capital attention, the moving-average condition as evidence of a long-term upward trend, and the bounded return as a way to identify stocks that have risen without an exceptionally large recent gain.

The proposed expanded screen also applies price-to-earnings and price-to-book limits and requires price to be above the Bollinger middle band. The article warns that these signals may fail in a declining market and that a ten-day return filter can miss rapidly rising stocks. It offers sample calculation logic but no backtest or performance evidence, and the position-change measure is not clearly defined or validated in the discussion.

Key ideas

• The initial screen combines a positive, bounded ten-day return with price above its 250-day moving average.
• It adds a position-increase ratio above 5% as a measure of recent capital interest.
• The expanded proposal adds valuation limits and a Bollinger middle-band condition.
• The author notes that broad market declines can invalidate the signals and that fast rallies may be missed.
• No backtest or performance results are presented.

Tags

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