An investing screen based on buying stocks that are close to their 52 week high (and/or selling stocks that are close to their 52 week lows).
Similar to other forms of momentum investing, this seems to work because investors tend to under-react to positive (or negative) information about those kinds of stocks. Researchers surmise that investors use the 52- week high as an “anchor” against which they value stocks, thus they tend to be reluctant to buy a stock as it nears this point regardless of new positive information. As a result, investors underreact when stock prices approach the 52-week high, and consequently, contrary to most investors' expectations, stocks near their 52-week highs tend to be systematically undervalued. Finally, when information prevails and the 52 week high is broken, the market “wakes up” and prices see excess gains.
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The Price vs. 52 Week High indicator compares the current price to the highest price at which the stock has traded at in the last 52 weeks (12 months), ie. the formula is : Current Price - 52 week High / 52 Week High.
To screen for companies that are within 10% of their 52wk high, the criteria would be Price vs. 52 Week High > -10 (i.e. greater / less negative than -10%). Here's a sample screen that you can fork.
Alternatively, if you wanted to set an alert for when a stock has fallen more than 20% below its high, you would set it for Price vs. 52 Week High < -20. Although the targeted value is numerically greater than 20, because it's a negative number, it needs to be shown as "less than".
Stockopedia explains % vs. 52w High...
Academic research has shown that stocks close to their 52 week highs tend to outperform. This is apparently because investors use the 52- week high as an "anchor" against which they value stocks, thus they tend to be reluctant to buy a stock as it nears this point regardless of new positive information. As a result, investors underreact when stock prices approach the 52-week high, and consequently, contrary to most investors' expectations, stocks near their 52-week highs tend to be systematically undervalued.
This indicates whether the company's main listing is in London. There are many dual listed companies on the London exchange who have their primary listing elsewhere. It's value is set to either 1 or 0 where 1 indicates a primary listing in London.
Stockopedia explains Is Primary Listing...
This can be a useful flag for identifying companies eligible for inclusion in tax efficient wrappers like ISAs and SIPPs.
To filter for primary listed stocks in the relevant exchange, set this value equal to 1, or to find stocks that are primary listed elsewhere set this equal to zero.
The Market Cap is a measure of a company's size - or specifically its total equity valuation. It is calculated by multiplying the current Share Price by the current number of Shares Outstanding. It is stated in Pounds Sterling.
Stockopedia explains Mkt Cap £m...
Market Capitalisation only takes into account the value of the company's shares (equity), it ignores the amount of debt a company may have taken on and therefore isn't the best indicator of the company's size. The Enterprise Value adds the net debt to the Market Cap and is a better indicator of the minimum amount that an acquiring company may have to pay to buy the firm outright.
The Bid-Offer Spread, also known as the Bid-Ask Spread, relates to the quote of the price at which participants in a market are willing to buy or sell a stock or security. The bid price is the price at which a party is willing to purchase, while the ask (or offer) price is the price at which someone is willing to sell.
The Spread is measured in basis points versus the mid-point price. It is calculated as being (ask - bid) / (midpoint price) * 10000.
A basis point is a unit of measure used describe the percentage change in a value. One basis point is equivalent to 0.01% (1/100th of a percent), so 100 basis points is 1 percent.
Stockopedia explains Spread (bps)...
The spread between the two prices arises as valuations differ. The spread will be larger for infrequently traded (aka. illiquid) stocks. From an investor's point of view, the spread is an extra cost, akin to the broker's commission.