Relative Strength of a Stock with Respect to an Index | Answer Revealed | Test Prep

Relative Strength of a Stock with Respect to an Index

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Question

When the relative strength of a stock with respect to an index is increasing, the stock is

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A. B. C. D.

C

The Relative Strength of a stock relative to an index equals the ratio of the stock price to the index price. Hence, if the relative strength is increasing, it indicates that the stock is doing better in price appreciation than the index.