Screening Stocks by ROE, Trading Range, and MACD

Summary

This stock selection idea combines a trading range filter with a profitability screen and a MACD condition. It seeks shares whose high-to-low price range exceeds one, whose return on equity has stayed above 15% for five years, and whose MACD reading from two days earlier was below zero. The document includes example indicator logic and a Python sketch for applying the lagged MACD condition and sorting selected shares by trading amount.

The author cautions that relying on a few indicators can miss company and industry specifics, and that MACD can be less effective as market conditions change. Suggested additions include other technical indicators, trading data, valuation measures, and broader fundamental or industry analysis. No backtest, performance evidence, or precise definition of the range threshold is provided; the examples also mix stock screening language with futures-oriented data code, so implementation details may need adjustment.

Key ideas

• The screen combines a price-range condition with five-year ROE and a lagged MACD reading.
• The example applies the MACD condition to a value from two sessions earlier.
• The document suggests adding technical, trading-flow, valuation, and industry information.
• It provides no test results establishing whether the screen is profitable.

Tags

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