Shorting stocks: Broken stocks - Analysis Message Board

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Strategies & Market Trends : Shorting stocks: Broken stocks - Analysis

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To: Q. who wrote (2032)	3/21/1999 7:26:00 PM
From: s berg	Read Replies (1) of 2506

John, Do you know what telescan means by low as possible. Is it some specific low percentile or are they screening all the low as possible variables against low absolute values for each variable. Thanks. How the scan was done:I used Telescan's Prosearch, available on the web (for a subscription) at tscn.com Search components were: shortability: price > $5 30 day ave vol > 5 k small cap: $20 M < market cap < $200 M low RS: rel performance 18 weeks : low as possible eliminate value stocks: p/b > 3 p/s > 2 free cash flow < 0 cash/price ratio : low as possible I optimized the above parameters in May and June 1998, which was soon after a small cap market peak, by backtesting the results (I played with the p/s, p/b ratios, the time span for the low RS, etc.) and this is the set of parameters that did the best over the previous 3-6 months. The returns from this screen are probably best over a 3+ month holding period. I don't recommend shorting any of the stocks produced by this screen. This list is intended only to encourage further research.

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