Stock Selection Analysis of Innovative Multifactor Model in New Energy Sector

Abstract

As of 2024, China’s new energy sector has made significant progress, ranking first in the world in terms of installed photovoltaic (PV) and wind power capacity. The proportion of new energy in the energy mix has increased significantly, driving China’s energy transition and sustainable development. Meanwhile, with the rapid development of Internet technology, quantitative investment strategies based on artificial intelligence technology are expected to show great growth potential in the future financial sector. In this context, this paper will construct a multi-factor model with the help of machine learning, combine value analysis and technical analysis, select candidate factors, develop exclusive factors for the characteristics of the new energy industry, test the validity of the factors, construct a multi-factor stock picking strategy and carry out backtesting analysis. The results demonstrate that the strategy can effectively manage risks and achieve excess returns, which is theoretically and practically instructive for the construction of investment portfolios. The results provide an effective investment strategy reference for financial institutions such as banks, brokerage firms and fund companies.