Screening Stocks for Moderate Turnover, Three Down Sessions, and Low K

Summary

This equity screen selects stocks with turnover between 3% and 12%, three consecutive sessions described as bearish, and a K indicator reading below 20. The article presents indicator-formula and Python examples. Its rationale is that the turnover band and declining price sequence, combined with a low K reading, narrow the candidate list; it does not explain a precise entry, exit, or position-sizing method.

No backtest or performance evidence is supplied. The author notes that a low K value does not establish that a stock is undervalued, and that the screen lacks fundamental filters. The examples also differ in how they implement the conditions: one checks a declining three-day moving average, while the Python section checks recent closes and appears to compare a multi-session return with the stated turnover band. These differences make the intended rules ambiguous and would need reconciliation before evaluating the screen.

Key ideas

• The screen combines a 3%–12% turnover range with a three-session decline and K below 20.
• The indicator formula uses a falling three-day moving average to represent a declining sequence.
• The Python example does not clearly implement the same rules as the stated screen.
• A low K reading alone does not indicate fundamental value or predict a rebound.
• The article reports no backtest results and recommends adding other filters and risk controls.

Tags

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