Relative Strength is a momentum strategy that helps you find stocks that consistently outperform a benchmark.
Stock Rover’s Relative Strength screener finds stocks with strong relative strength defined as consistent outperformance vs. the S&P 500 in all periods, ranging from the short term (5 days) to the long term (5 years). The screener checks for outperformance vs. the S&P 500 in the intervening periods as well, including: 1 month, 3 months, 6 months, 1 year, and 3 years. The longer the period, the more the outperformance must be to pass this screener.
We’ll start by showing how to import the screener from the Stock Rover library as well as how to perform research on the screener’s results using the Table, Chart, and Insight layouts. We’ll finish with a demonstration of “Scoring” where we use the Relative Strength screener to determine the relative strength of a portfolio’s holdings.
Stock Rover’s Relative Strength screener is among the 150+ screeners available for import from the Investor Library. The Investor Library is accessible from the Start Menu ➡ Library.
Once in the Library, selecting the Screeners radio button will display a list of all the screeners available for import. Previously imported screeners will show in grey font. To locate our screener we can either scroll through the Screeners pane or narrow down the screener list by entering “Relative” in the search box, as we’ve done below.
Once the screener has been selected the bottom pane displays the screener’s filtering criteria. We can see that our Relative Strength screener’s filtering criteria are as follows:
Clicking the “Import” button then loads the screener into Stock Rover.
Once the Screener has been imported, we’ll then want to run the Screener by first selecting the Table, which is in the Research group in the Start menu. Then from there, selecting the desired screener from the Navigation panel.
Stock Rover will then display the passing tickers using the selected View in the Table, which in the case below is the “Profile” View.
We can now conduct a comparative analysis of the tickers using the Table. Then we can display key fundamentals and key technical indicators via the Chart. And finally we can conduct specific ticker research with the Insight Panel.
The Table provides a flexible spreadsheet-like paradigm for viewing tickers and their associated data, enabling you to easily perform a comparative analysis. We access the Table directly by selecting Start Menu ➡ Table.
When the Relative Strength screener is selected in the Navigation pane, the Table will load with the tickers that currently meet the screener’s filtering criteria.
Below, we are looking at the screener results through the ‘Returns vs. S&P 500’ View, which can be selected by clicking its tab at the top of the Table. The Table’s header shows that 114 stocks pass the screener’s filtering criteria.
Each of the 114 rows in the Table represents a ticker that met our filtering criteria, and each column represents a metric we would like to display. In our example, the ‘Returns vs. S&P 500’ View is preconfigured with columns for:
Right-clicking on a column header allows us to alter the Table display. For example, we can tailor our display with sorting, filtering, grouping, and more. We’re going to filter the Table to show only tickers with a YTD Return vs the S&P 500 with a value between 100% and 150%.
Below we see the tickers that met our YTD Return vs S&P 500 column’s filtering criteria.
We can also add a ticker or multiple tickers to the Table for even more comparison, this is accomplished via the Quotes List feature. The Quotes List can be quickly populated by typing the desired tickers and/or company names into the search box next to the Stock Rover logo.
As we want to see how H&R Block compares against our filtered tickers, we’ve entered the symbol HRB in the search box and added H&R Block to the Table. Note the tickers on the Quotes List are differentiated in the Table with bolded symbols as we can see with the HRB symbol for H&R Block.
The Chart is where we chart prices. We can also chart over 100 fundamental metrics and we can chart key technical indicators. We can also baseline stocks or use ratio charts for easy relative performance comparison.
We access the charting facility either by selecting Start Menu ➡ Chart to display the chart only or selecting Start Menu ➡ All for All mode, which we’ve done below. All mode shows the Chart along with the Table and the Insight Panel. We can then see comparative information for the selected ticker, as well as the Chart, and detailed Insights all at once.
Here we are charting one of the tickers that passed our Relative Strength Screener, Sabine Royalty (SBR). We’ve also added the S&P 500 as a benchmark via the “Compare to” menu and we’ve also set it as a baseline by clicking on the red S&P 500 label in the legend.
We can also add Technicals to the chart by clicking on the Technicals pull-down menu and then selecting one or more boxes in the drop-down menu. Let’s chart the Relative Strength Index for good measure. We’ll stick with the default period of 14 days.
The Price chart is displaying Sabine Royalty outperforming the S&P 500, while the RSI chart under it is showing Sabine Royalty in the 30 to 60 range. In a down market, the RSI tends to stay between 10 to 60, with the 50-60 zone acting as resistance.
The Insight Panel is populated with a wealth of analytics or “Insights” that are specific to the selected ticker. We access the Insight Panel either by selecting Start Menu ➡ All to enter All mode (as we’ve done above) or Start Menu ➡ Insight to display the Insight Panel only (as we’ve done below). Here we can see price performance, Fair Value, and Margin of Safety. We also see Stock Rover’s proprietary stock scoring system, and much more.
As we are focused on Relative Strength, we’ll highlight the analytics related to “Return vs. Benchmarks”. Here we see the return performance of our selected ticker Sabine Royalty, its industry, and the S&P 500. In addition, the 1-Year Beta is displayed.
Up to this point our focus has been primarily on how to run the Relative Strength screener and perform research and analytics on the passing tickers. However, screeners can also be used to evaluate portfolios and watchlists via “Scoring”.
To “Score” a portfolio or watchlist means we can see how the stocks in a portfolio or watchlist perform against the full set of a screener’s filters.
For example, we can use our Relative Strength screener to see which of our portfolio holdings consistently outperform the S&P500 and to what degree.
We’ll first launch the Screener Manager by selecting Start Menu ➡ Screeners.
Once in the Screener Manager, we’ll then select the Relative Strength screener. Lastly, we’ll click on the Score Portfolio pulldown (highlighted below) and select the desired portfolio we would like to score.
In our example, we’ve selected a portfolio called BT – Top Stocks – 7-15-22.
When “Scoring” is initiated Stock Rover will show a “Score” column in the Table, making it available across Views. In our example, we’re displaying the portfolio in the Table using the “Returns” View. As our Relative Strength screener has 7 filtering criteria, the scoring for each ticker in the portfolio will range from 100%, 7/7 meaning the ticker passed all the filter criteria to 0%, 0/7 meaning the ticker did not pass any of the filter criteria.
In the example below, when we mouse over HDUGF (Hunter Douglas) we see the ticker scored 57%, 4/7, so it meets 4 of the 7 criteria.
The tooltip shows how the 57%, 4/7 score was derived, showing the filtering criteria, Hunter Douglas’ current Value, and whether it passed or failed.
Stock Rover’s Relative Strength screener, which is available in the Stock Rover Investor’s Library, finds stocks with strong relative strength defined as consistent outperformance vs. the S&P 500 in all periods, ranging from the short term (5 days) to the long term (5 years).
The concepts outlined in this blog post are applicable to all screeners, whether it is a pre-built screener like our Relative Strength screener or one that you have edited or created from scratch.
When you’re ready to perform a comparative analysis, chart, or do a deep dive into a ticker, you’ll want to utilize the capabilities of the Table, Chart, and the Insight panel as we illustrated in the previous sections of this blog post.
Screeners can also be leveraged in additional ways beyond filtering for tickers that pass the screener. One of the key capabilities is “Scoring”, where you can see how stocks in your portfolio or watchlist perform against the full set of filters from your screener, as we illustrated in the prior section of this blog post.
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