Poll Results: Minimum Market Capitalization for Backtests

The poll results are in for the minimum market capitalization requirement for backtest on Fat Pitch Financials.  In that poll I asked, “What minimum market capitalization do you prefer for backtests on Fat Pitch Financials?”  The options respondents could choose were:

• $50 million (old minimum)
•  $1 billion (new minimum to match S&P 500)
• Other

The most popular response was $50 million, with 52 percent of the responses.  Here’s a full breakdown of the poll results:

If you add in the one vote for $10 million minimum, the $50 million category actually was about 57 percent.  The proposed new $1 billion minimum got 33 percent of the vote.

Given these results, I’m going to revert back to using $50 million minimum market capitalization for backtests and I’m going to explore using a smarter liquidity test that requires a minimum dollar traded value over the past month versus a minimum average trading volume.