Post #1214 by mapg on the Mechanical Investing board

Investment Strategies / Mechanical Investing ❤

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One solution is to avoid screening for extremely high ROE. Instead look for above average ROE, and include a check on debt levels (increased debt will decrease equity).

Thanks for that info.
Not backtested but looking at Fidelity Screener the change has some significance.
The obvious is sectors are more distributed with less IT.

        ROE_GMI (FH,Q)         AS OF 09:13 AM ET 12/07/2023 
      Criteria: (Name)               Criteria: (range)        Count  (%)
Security Type                  Common Stock                   7992   
Security Price                 No Filter                             
Company Headquarters Location  United States of America       5802   
Market Capitalization          Mega, Large, Medium & Small    1365   100%
Current Ratio (MRQ)            Very high, high & Medium        643   47%
Quick Ratio (MRQ)              Very high, high & Medium        548   40%
S&P GMI Financial Health       Very high, high                 159   12%
S&P GMI Quality                Very high, high                 125    9%
Return on Equity (TTM)         Very high, high & Medium         80    6%
Sector                         Exc. Financial & REIT            72    5%
Industry                       Industry                         72    5%
Sub-Industry                   Sub-Industry                     72    5%

  Current SoR Profile   CountIF()    %
        Sector              --      --
Industrials                 17     24%
Health Care                 17     24%
Materials                   12     17%
Information Technology      11     15%
Consumer Discretionary      4       6%
Energy                      4       6%
Communication Services      3       4%
Consumer Staples            3       4%
Utilities                   1       1%
Financials                  0       0%
REIT                        0       0%
Market Capitalization       --      --
Mega                        4       6%
Large                       11     15%
Medium                      24     33%
Small                       33     46%
                            --      --
Total Count                 72     100%

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