Working with sector indices

The relative strength comparison indicator is a useful tool for determining how well one security is performing when compared to the market, or to another security.

A common request is to want to use the RSC to compare a company to the index of its own sector. Normally this would require you to manually enter the sector index code into RSC for each security.

By using the Security.SectorIndex variable, we can modify the RSC indicator script to automatically select the correct index. Follow these steps:

1. Open the indicator window and select the builder tab
2. Locate the "Relative Strength Comparison" indicator and select copy.
3. Find the line: symb := inputsymbol("Compare to", "XAO"); and change it to symb := Security.SectorIndex;
4. Save the indicator and add it to your chart
   

This new indicator will automatically display the RSC comparing the company to the index of that companies sector. The Security.SectorIndex returns the ASX code of the relevant index.

By using similar techniques, you could also make it just display the index (instead of the RSC). You can also use this new indicator in a scan to find companies that are out performing their sector.