What is Relative Strength Comparative?
Technical analysis offers a few wonderful tools with the help of which, we can check out the Relative Strength Comparative, RSC. As the name suggests, it is a comparative measure of strength vis-à-vis a benchmark or a share or a sector. The best way you can put the RSC to use before initiating a trade is to check out how your scrip has performed historically. It can be against the indices, it's peers in the same sector and or a separate asset class like say, commodities. To that effect, RSC helps in determining which scrip would be the most profitable investment.
Highly volatile scrips rise or fall faster than the indices, but may not make large net moves in any single direction. On the other hand, high RSC scrips will rise faster than the indices but fall slower than the indices in a downturn. To that extent, they are solid market outperformers and have unidirectional upward movement. Needless to say, buying scrips with the highest RSC reading among the available choice of stocks will ensure a greater probability of capital appreciation.
Highly volatile scrips rise or fall faster than the indices, but may not make large net moves in any single direction. On the other hand, high RSC scrips will rise faster than the indices but fall slower than the indices in a downturn. To that extent, they are solid market outperformers and have unidirectional upward movement. Needless to say, buying scrips with the highest RSC reading among the available choice of stocks will ensure a greater probability of capital appreciation.