Indicator - Mansfield's Relative Strength
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Definition Mansfield's Relative Strength
This indicator represents the evolution of a security's price compared to another one (a stock or a market index) over an average of 52 periods by default.
In order to study the relative strength of a stock compared to a market index :
- the ratio is calculated for every period (Ratio = price of the security/price of the index)
- the average ratio is computed using the last 52 ratios
- the percentage of variation is calculated applying Mansfield's arbitrary multiplier of 10.
The resulting line oscillates around a zero-level horizontal line.
Interpretation Mansfield's Relative Strength
This indicator, used by Stan Weinstein, represents the correlation between two securities or generally between a security and its sectoral or market index, using Mansfield calculations on weekly view.
On this view, when the indicator is going up, this means that the first security is outperforming the second over the long term and when it decreases, that means that the first security is underperforming the second over the long term.
