RRG chart: how to read a relative rotation graph
A relative rotation graph (RRG) plots many sectors or stocks on one chart to show who is leading the market, who is catching up and who is fading. Market Strength Scanner includes a free RRG-style rotation chart for NSE sectors, industries and themes.
Open the free scannerWhat is an RRG?
An RRG, short for relative rotation graph, is a chart that compares the relative strength of many securities against a common benchmark at the same time. Instead of one line per stock, each sector or stock is a single dot on a two-axis map, so you can see the whole market’s leadership in one picture.
One axis shows relative strength: is the group outperforming or underperforming the benchmark? The other shows the momentum or direction of that relative strength: is the outperformance rising or falling? Together the two axes split the chart into four quadrants.
The four RRG quadrants
- Leading (strong and strengthening): the market leaders.
- Weakening (strong but losing momentum): leaders that are cooling off.
- Lagging (weak and weakening): the laggards.
- Improving (weak but turning up): groups that may be starting to catch up.
Over time groups tend to rotate clockwise: improving, then leading, then weakening, then lagging, and around again. This is a tendency, not a rule, and many never complete the circuit.
Reading the tails
Each dot trails a tail showing where it has been over recent weeks. A long tail means a fast change; a tail curling toward the Leading quadrant shows relative strength building; a tail turning back shows a move fading. Reading direction and speed from the tail is what separates an RRG from a static ranking.
RRG for NSE sectors, themes and stocks
The scanner’s rotation view applies this idea to Indian markets: sectors, industries and cross-sector themes, each measured against the market. Filter by quadrant to list only what is Leading or Improving, then open a group to see its highest relative-strength stocks.
For a deeper look at the groups themselves, see sector rotation analysis; for the ranking underneath, see the relative strength scanner.
Limits of an RRG
An RRG describes what has already happened. A dot in the Leading quadrant is not a signal to buy, and a dot in Lagging is not a signal to sell. Results depend on the benchmark, the look-back and the smoothing used, and a sector can look strong because only a few stocks in it are moving. Check breadth and persistence, and use the chart to build a watch list, not to time trades.
Frequently asked questions
What does RRG stand for?
RRG stands for relative rotation graph, a chart type that plots relative strength and its momentum for many securities against a benchmark on one map.
How do I read an RRG chart?
Find the quadrant a dot sits in (Leading, Weakening, Lagging or Improving), then look at its tail to see which way it is moving and how fast.
Is the RRG the same as relative strength?
No. Relative strength is the underlying measure. An RRG adds the direction of that strength and shows many securities on one chart.
Is there a free RRG chart for Indian stocks?
Yes. Sign in with a Google account to use the free rotation chart for NSE sectors, industries and themes.
Is the RRG a buy or sell signal?
No. It shows relative leadership and how it is changing. It is a research aid, not a recommendation.
Is Market Strength Scanner affiliated with RRG Research?
No. “Relative Rotation Graphs” and “RRG” are terms and trademarks of RRG Research. This site is independent and offers its own RRG-style rotation chart.