Relative Strength Strategy Calculation Investment Insights

1464 reads · Last updated: January 4, 2026

Relative strength is a strategy used in momentum investing and in identifying value stocks. It focuses on investing in stocks or other investments that have performed well relative to the market as a whole or to a relevant benchmark. For example, a relative strength investor might select technology companies that have outperformed the Nasdaq Composite Index, or stocks that are outperforming the S&P 500 index.Technical analysts use an indicator known as the relative strength index (RSI) to generate overbought or oversold signals.

Suggested for You

Refresh