Selecting Chinese Stocks with RSI and Circulating Market Capitalization

Summary

This stock-selection proposal combines a 14-period RSI threshold below 65 with circulating market capitalization. It includes stocks in a stated mid-cap range as well as those above that range, then ranks qualifying names by price change and selects up to five when enough candidates are available. The document presents this as a way to pair a technical condition with a size filter; it provides no backtest results or performance evidence.

The author cautions that the screen omits company financials, industry prospects, and macroeconomic conditions. Fixed market-cap bands can also create style bias, while market conditions may change faster than the screen reflects. Suggested improvements are to assess valuation, sector outlook, and the macro backdrop, and to adjust capitalization criteria to the market and selection objective. The RSI and size rules are therefore a preliminary filter, not a complete investment process or evidence of an edge.

Key ideas

• The screen requires RSI below 65 and circulating market capitalization within either of two specified groups.
• Qualifying stocks are ranked by price change, with up to five selected when at least five pass the screen.
• The document gives no backtest or live-trading evidence for the selection rule.
• Fundamentals, industry outlook, macro conditions, and possible market-cap style bias are identified as limitations.

Tags

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