Relative Strength Comparisons
One of the major advantages of our charts is that you can quickly and easily create a custom Relative Strength comparison right from the chart page.
To do so, simply click the plus icon next to the ticker search bar. This will allow you to add another ticker to create your Relative Strength chart.
By default, this will initially bring up this security's Market RS chart (unless you have specified a different default RS ticker within chart preferences), but you also have the option to select the security's peer RS comparison, recent tickers you have used in RS comparisons, or to any ticker you choose to enter in the search box.
On your RS chart, the ticker on the left will be in the numerator of the RS calculation and the ticker on the right will be in the denominator. Therefore, a chart in a column of Xs means the ticker on the left is outperforming and a chart in a column of Os means the ticker on the right is outperforming.
To remove the RS comparison and return to this security's trend chart, click the X icon to the right of both ticker search boxes.
Relative Strength Strategy Tables
Directly below a Relative Strength chart, there are two tables that are designed to help you gauge the potential effectiveness of using Relative Strength to develop a strategy for trading the securities in your RS comparison. They can also help you determine the most appropriate scale for comparing the two securities on your RS chart.
If you do not see these tables on your RS chart page, you can turn them on on the chart preferences page by checking the "Show RS Signal Switching Table" and "Show RS Column Switching Table" options.
The "Signal History" table looks at the effectiveness of switching between the two securities in your RS comparison every time there is a signal change on the chart. It does this by compares three hypothetical strategies:
- Buying and holding security 1 (AAPL in the below example)
- Buying and holding security 2 (MSFT in the below example)
- Buying AAPL when the RS chart is on a buy signal and selling AAPL to buy MSFT when the RS chart is on a sell signal. (RS Switching column in the below example)
The "Reversal Portfolio Value" table looks at the effectiveness of a strategy that switches between each of the securities in your RS comparison whenever the chart reverses columns. The strategy in the example below would buy AAPL when the RS chart is in a column of Xs and sell AAPL to buy MSFT when the RS chart is in a column of Os. The Value column in this table can be compared to the buy-and-hold columns in the "Signal History" table to judge the effectiveness of the strategy.