The 5 main benefits of using momentary investments in relative strength are often overlooked with stocks, ETFs or mutual funds, just trying to buy and make money. This is due to the fact that the name “moment of relative strength” is frightening and is not understood by many people.
As I wrote earlier, “Avoiding Mistakes with Relative Strength Investment,” RSM-based analysis provides a step-by-step analysis of how strong the stock or fund momentum is and even better, properly configured, by comparing it to the extent of its strength. It is compared to other ETFs or funds. This compelling RSM analysis therefore focuses on ticker symbols that are not only powerful and powerful, but have the ability to continue to rise; and when they are in doubt, it is time to sell. ”
Advantage 1:
This is one of the most proven methods of technical analysis to find consistent return on investment.
Numerous books have been written about RSM, including Michael J. Carr’s definitive guide: Smarter Investing In Any Economy (now sold out, but we hope to reprint it soon).
Advantage 2:
RSM works for all types of investments:
- In the short term
- In the long run
- Moderate
- Offensive
- Conservative
- Stocks
- ETFs
- Mutual societies
Advantage 3:
The formulas that give the best results can be implemented even if you are not a technical expert or a math expert because they are part of the available investment software.
The different formulas, all related, provide the ability to decide which way to analyze RSM and how to invest in the moment of relative strength that suits your goal and personality.
Carr tests seven different formulas for relative strength:
- Alpha
- Standardized rate of change (ROC)
- Back weight ROC
- Weighted front ROC
- Price / average ratios
- Average multi-mobile rations
- Mean different time periods
Advantage 4:
Analyzing investments with an alpha or other RSM method can easily be combined with other buying and selling rules, both personal investment software and investment advisory software.
The following rules of sale and purchase are as follows:
- Stops
- How long do you hold a position
- Classify your ticker symbol to ensure a high position between groups
Advantage 5:
You can perform easy technical analysis without or without standard deviation (SD). Adding SD to your analysis can automatically make you more conservative.
In fact, with or without SD, you can optimize any RSM calculation with conservative or moderate investment like alpha or even aggressive investment software to meet your goals.
Although the momentary investment of relative strength is frightening, it can lead to long-term growth of your portfolio, especially if you find a personal investment software program that converts RSM with just a few clicks of the mouse and allows you to compare potential benefits and risks.