RPS Rate Calculator

| Added in Business Finance

What is RPS Rate?

Relative Price Strength (RPS) Rate measures how a stock's performance compares to the overall market. This metric helps investors identify stocks that are outperforming or underperforming relative to market conditions, providing valuable insight for investment decisions.

The Formula

[\text{RPS Rate} = \frac{\text{Stock Price Trend}}{\text{Market Trend}}]

Where:

  • Stock Price Trend is the percentage change in the stock price
  • Market Trend is the percentage change in the overall market (e.g., S&P 500)

Interpreting Results

RPS Value Meaning
> 1.0 Stock outperforming the market
= 1.0 Stock performing equal to market
< 1.0 Stock underperforming the market

Calculation Example

Given:

  • Stock price trend: 8%
  • Market trend: 10%

[\text{RPS Rate} = \frac{8}{10} = 0.8]

An RPS of 0.8 means the stock is underperforming - it gained only 80% of what the market gained.

Investment Tips

  • Look for trends: Regularly monitor RPS to spot long-term performance patterns
  • Compare within sectors: Use RPS to compare stocks in the same industry
  • Combine with other metrics: RPS works best alongside other fundamental analysis
  • Consider momentum: High RPS stocks often continue their outperformance

Frequently Asked Questions

Relative Price Strength (RPS) compares a stocks performance to the overall market. It shows whether a stock is outperforming or underperforming relative to market conditions.

An RPS above 1 indicates the stock has outperformed the market. For example, an RPS of 1.5 means the stock gained 50% more than the market.

An RPS below 1 indicates the stock has underperformed the market. An RPS of 0.8 means the stock gained only 80% of what the market gained.

Use RPS to identify stocks with strong relative momentum. Many investors look for stocks with high RPS as they may continue outperforming. Compare RPS across stocks in the same sector.