As was the case for PSL5, PSL6 and PSL7, I am exclusively China. I realize it is pushing the envelope, but then picking ANYTHING right now is pushing the envelope IMO.
My universe of China stocks to pick from were limited to the 61 stocks in the ChVMC08 (see bottom). Since these stocks are all similar in terms of issues relating to qualifying for the index - nano/micro China stocks with specific limitations on market cap, PE, dollar volume, etc, the SINGLE most important remaining variable is the chart. I rated every one of them by the chart - (generally meaning) the bigger the drop, the better. That reduced it to roughly 15 or so. I then looked at PE to help eliminate a couple more. Finally, I looked at the business each is in, the Revenue Growth Rate and the Financial Condition of the company.
That got me to the final six I chose.
FIN. Rev Mkt Name Chart PE Cond. Grwth Cap SOS Float Business SORL Good 12 Good 35% 118M 18M 7M Auto Parts CAAS Good 19 Good 43% 151M 24M 4M Auto Systems and Components CAGC Good 6 VG 32% 59M 24M ?? Fertilizer CHME Good 6 EXC 68% 32M 15M 7M Pharma Distributor DSWL Good 9 VG 17% 91M 16M ?? Rubber and Electronics TSTC Good 9 Good 40% 47M 10M 6M Wireless Communications
ChVMC08 QUALIFICATIONS
China Stock No Pinks Minimum of 40 cents Less than $340M market cap Maximum PE 28 Maximum SOS 73M Minimum $300K trading volume over most recent 3 months ($5,000 per day).
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