Stocks with Moderate RSI, Positive Returns, and Profit Growth

Summary

This stock-selection rule combines a 14-period RSI below 65, positive daily return, and year-over-year growth in net profit attributable to parent shareholders above 20% and at most 100%. The article presents the combination as a way to find companies with earnings growth and a positive short-term price move without an RSI reading above its threshold. Its sample database query also includes positive net profit, a large free-float market capitalization, and excludes certain listings, making the illustrated universe narrower than the headline rule alone suggests.

The document cautions that the screen omits other fundamentals, including industry prospects and capital structure, and that one-day returns can be volatile. It proposes adding company and industry analysis or evaluating the rule in more stable market conditions. No backtest results or evidence of predictive performance are given. The code examples also use different data treatments for profit growth, so implementation would need a consistent definition and point-in-time financial data to avoid misleading selections.

Key ideas

• The core screen requires RSI below 65, positive daily return, and net profit growth above 20% and up to 100%.
• The database example adds positive net income and a large free-float market-capitalization filter.
• The article combines a technical indicator, a daily price condition, and earnings growth.
• Daily return volatility and omitted company fundamentals are identified as limitations.
• The examples use differing profit-growth calculations and provide no performance test.

Tags

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