Open stock strategy

Screening Filters

1. Market Capitalization (market_cap: min $10 billion):

   • Purpose: To focus on large-cap companies with a market capitalization of at least $10 billion.
   • Rationale: Large-cap companies are typically more stable, well-established, and less volatile compared to smaller companies. This aligns with an "open stock strategy" that may prioritize reliable and proven businesses.

2. Price-to-Earnings Ratio (pe_ttm: max 20):

   • Purpose: To identify stocks that are reasonably valued or undervalued based on their earnings.
   • Rationale: A P/E ratio below 20 is often considered a benchmark for stocks that are not excessively overvalued. This ensures the strategy avoids overpriced stocks and focuses on those with potential for growth or steady returns.

3. Earnings Per Share 5-Year Compound Annual Growth Rate (eps_5yr_cagr: min 10%):

   • Purpose: To find companies with a strong track record of growing earnings over the past five years.
   • Rationale: A minimum EPS growth rate of 10% indicates that the company has consistently increased its profitability, which is a positive indicator for future performance and aligns with a strategy seeking growth-oriented investments.

4. Dividend Yield (dividend_yield_ttm: min 2%):

   • Purpose: To include companies that provide a steady income stream through dividends.
   • Rationale: A minimum dividend yield of 2% ensures that the selected stocks offer a reasonable return to investors in the form of dividends, which can be an important component of an open stock strategy that values both growth and income.

5. Beta (LowRisk):

   • Purpose: To focus on low-risk stocks with a beta below 1.
   • Rationale: Low-beta stocks are less volatile than the overall market, making them suitable for investors seeking stability and reduced risk. This aligns with a strategy that may prioritize steady performance over speculative or high-risk investments.

Why Results Match:

• The selected filters collectively focus on large, stable, and well-established companies with a history of earnings growth, reasonable valuations, and consistent dividend payouts. These characteristics align with an "open stock strategy" that seeks a balanced approach to investing, combining growth, income, and risk management.
• By screening for low-risk stocks with a beta below 1, the strategy ensures that the portfolio is less exposed to market volatility, which is particularly important for investors seeking stability.
• The combination of growth (EPS growth), value (P/E ratio), income (dividend yield), and stability (low beta) makes the selected filters highly relevant for constructing a diversified and resilient portfolio.