Methodology / Relative Strength

Relative Strength: the same period, measured against a benchmark

Relative Strength is a difference, not a standalone reading. It takes a ticker's price change over three horizons — roughly a quarter, half a year and a year — and subtracts the broad-market benchmark's change over exactly those same periods.

One of the six factors in the Tapeline composite. The second-heaviest factor in the composite, after Trend. Tapeline publishes the ordering of the factor weights, not the numeric weights or the scoring equation.

What it measures

Observable quantities, nothing else

• ·The ticker's price change over roughly a quarter, half a year and a year.
• ·The broad-market benchmark's change over each of those same three periods.
• ·The difference between the two, computed separately for each horizon.

How the reading is derived

The same procedure on every ticker

1. 01The three per-horizon differences are combined into one reading. The longer horizons carry more weight than the shorter one, so a single quarter cannot dominate the result.
2. 02The combined difference is mapped onto a common 0–100 scale centred on a midpoint, where the midpoint means 'moved with the benchmark'. Above the midpoint the ticker changed by more than the benchmark over the period; below it, by less.
3. 03Horizons with no data are skipped, and the reading is built from whichever of the three are available.
4. 04Readings are clamped to the 0–100 range.

Tapeline deliberately does not publish the numeric weights, the scoring equation, or the exact band edges used to map a measurement onto the 0–100 scale. What is published is the factor set, the weight ordering, each factor’s contribution on every ticker, and the record of every daily top-10.

What feeds it

Data behind this factor

Every category, its refresh cadence and where it appears in the product is listed on data sources.

Known limitations

Where this factor is weak

Every one of these is a property of the method, not a bug waiting to be fixed. They are listed here so a reader can decide how much weight to give the reading.

• —The reading moves when the benchmark moves, not only when the ticker does. A quiet ticker in a moving market produces a moving reading.
• —The comparison is against a single broad-market benchmark. It is not sector-adjusted, so a whole sector moving together shows up as a ticker-level reading for every name in it.
• —ETFs and funds are compared against the same broad-market benchmark regardless of what they actually hold, which for a narrow or inverse fund is close to meaningless.
• —Thin-volume tickers produce noisy period returns, and therefore noisy differences.
• —Three horizons is a coarse view of a year. A sharp move that reversed inside a horizon is invisible to it.

Limits that apply to the whole product, rather than to this factor, are on limitations.

Common questions

Relative Strength FAQ

The other five

Each factor has its own page

Back to the full methodology overview, or read why Tapeline publishes its losing days.