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Essentially,
this is a buy high, sell higher approach. The basic concept of relative strength
is that the stocks which are stronger compared to their peers will appreciate to
a much greater degree than the average issue. This dictates buying stocks after
they have already made significant gains. The average investor finds this
difficult to do because it is, in effect, the opposite of conventional lore of
buying low and selling high. The high relative strength stocks, however, are
exactly the ones Sullivan wants because they offer the potential for the
greatest gains.
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