Kasauti™ Start Free →
Kasauti  ›  Glossary  ›  Market Structure  ›  RS Rating
Market Structure · Relative Strength Rating

RS Rating

A score from 1 to 99 that ranks a stock's price performance against the entire NSE universe over the past 52 weeks — the higher the score, the stronger the market leadership.

Methodology reference · NSE context
Definition

RS Rating, or Relative Strength Rating, is a technical metric developed by William O'Neil that ranks a stock's price performance relative to the entire market universe over the trailing 12 months. For NSE position traders, it provides a quantitative measure of which stocks are demonstrating superior price momentum compared to their peers. The rating is expressed on a scale of 1 to 99, with 99 indicating the strongest relative price performance. This metric is a cornerstone of the CAN SLIM methodology and is used to identify stocks that are leading the market in price action.

Sector RS Ranking — Deployment Threshold at RS 80 0 20 40 60 80 100 RS 80 — Deploy threshold 91 BANK STAGE 2 87 IT STAGE 2 83 PHARMA STAGE 2 74 AUTO STAGE 3 66 FMCG STAGE 3 48 METAL STAGE 4 38 REALTY STAGE 4 22 MEDIA STAGE 4 DEPLOY ZONE RS > 80 · Stage 2 · 60%+ constituents Bank, IT, Pharma qualify this cycle AVOID ZONE — Stage 3 or 4, RS below threshold Auto, FMCG watch; Metal, Realty, Media — no deployment RS Rating (1–99)
An RS ranking example showing how a 1–99 scale separates stronger and weaker market groups.

For the NSE position trader, RS Rating serves as a critical filter to narrow the universe of over 2,000 liquid stocks to only those demonstrating consistent price leadership. A stock with an RS Rating of 80 or above has outperformed 80% of all NSE stocks over the past year, indicating it is in a strong structural uptrend. This metric is particularly valuable in the Indian market where sector rotation can be swift, as it helps identify which stocks are attracting institutional capital flow. The RS Rating is not a timing tool but a screening mechanism to ensure one's focus remains on the strongest price performers.

A common misconception among NSE traders is that a high RS Rating alone guarantees future outperformance. In reality, the RS Rating is a lagging indicator that reflects past price strength, and a stock can become extended after a long run, making it vulnerable to a correction. Serious practitioners understand that RS Rating must be used in conjunction with other technical parameters such as the stock's proximity to its 50-day moving average and the overall market stage. The most effective use of RS Rating is to identify stocks early in their uptrend when the rating is rising from a lower base, not after it has already reached 99.

PARKHO · stock methodology audits
See methodology applied on real stock pages. Move from the definition to a structured stock-level methodology snapshot.
Browse PARKHO →

Frequently asked questions

RS Rating is calculated by comparing a stock's price performance over the trailing 12 months against every other stock in the NSE universe. The calculation uses a weighted average of the most recent three months' price change (double-weighted) and the preceding nine months' price change (single-weighted). Each stock is then ranked from 1 to 99 based on this relative performance. A rating of 99 means the stock has outperformed 99% of all NSE stocks over that period.
Methodology note: This glossary page summarises technical-analysis concepts in an NSE research context. It is educational and analytical content, not investment advice or a stock recommendation.