RELATIVE AVERAGE TRUE RANGE (RATR)

Average True Range is a measurement of volatility measured in currency. One issue might have an ATR of $1.00 another of $2.00. This does not make the second issue more volatile than the first. ATR are not directly comparable.

Relative ATR (abbreviated RATR) is the end of day ATR divided by the closing price. The result is a measurement of ATR as a percentage of the closing price. Consider the folllowing table . . .

Complete defintion (in a new browser window).