Tools for Gauging Relative Price Strength
Post on: 16 Март, 2015 No Comment

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It’s all relative, as Einstein used to say. Most stock prices rise and fall with the rest of the market. But there are always some that run ahead of the pack.
Wouldn’t it be nice to own those? Or how about just knowing the relative price strength of the stocks you already own on any given market day? Stock Rover (stockrover.com ) can answer those questions quickly.
Its standing relative strength screen pops up a list of the latest price-momentum leaders from among approximately 8,000 of the most liquid securities traded on North American exchanges. Alternatively, you can ask it for the relative strength of one or more individual tickers of your choosing.
Why relative price strength? Because, with market indexes and valuations reaching new highs, this metric is like a canary in a coal mine that can signal whether a ticker still has momentum or is running out of steam.
Table members can be sorted in a variety of ways to discover trends. Let your mouse hover over a ticker, and up pops a dialog box full of intraday-trading information such as price/earnings ratio, volume, beta, and much more.
But relative strength is just a starting point for research, not an end-all, be-all, warns Reisman. Other tabs above the table open different views on the short list, each chock-full of valuation metrics. These describe how the winners stack up against one another from different perspectives—in terms of value, growth, dividends, earnings performance, governance, and other key measures.

Tickers not in the top 100 can simply be typed in. Highlight any specific table member, and a very customizable price/volume chart will describe its performance against any market index you choose. It’s easier to spot a trend in a chart: If your stock’s price line stays mostly above that of the index, it’s showing relative strength.
Stock Rover charts support a bevy of fundamental and technical indicators, but the page is a little crowded. For a larger view, Yahoo! Finance (finance.yahoo.com ) has a remarkably robust charting capability. It’s free and similar in format to Stock Rover views, so it’s easy to toggle between the two.
All Stock Rover features are free. Its relative-strength screen is a jumping-off point for an encyclopedic collection of financial information normally requiring searches on many different Websites.
RELATIVE STRENGTH IS just one facet of several momentum-investing strategies, a popular one being Investor’s Business Daily’s CAN SLIM regimen (education.investors.com/onlinecourses.aspx ). Relative strength is the L, for leader or laggard, in the seven criteria devised by IBD founder William J. O’Neil.