52-Week High and Low: What Distance From Them Says About a Stock
How far the price is below its highest price of the past year, in percent. Zero is at the high; being near it means an uptrend on a one-year view, not that the stock is expensive.
Contents (5 sections)
The 52-week high is the highest price a stock traded at in the past year, and the 52-week low is the lowest. How far today's price is from each is one of the simplest ways to say where a stock stands in its own recent history.
How the distance is measured
- Distance from the 52-week high is how far the price is below the high, as a percentage of the high. Zero means the stock is at its high; 30 means it is 30 percent below it.
- Distance from the 52-week low is how far the price is above the low, as a percentage of the low. Zero means it is at its low; 50 means it is 50 percent above it.
The two are not mirror images. A stock that fell from 100 to 50 is 50 percent below its high, and needs to double to get back.
Reading them
| Where the price is | What it usually means |
|---|---|
| Within 5% of the 52-week high | The stock is in an uptrend on a one-year view; everyone who bought in the past year is in profit |
| 10% to 25% below the high | A pullback or the early part of a decline; the trend decides which |
| More than 40% below the high | A deep decline: something changed, in the business or in how it is valued |
| Within 10% of the 52-week low | The stock is weak on a one-year view; most recent buyers are at a loss |
What it does not tell you
- That a stock near its high is expensive. A new high describes price, not value. Stocks that go on to rise a great deal spend much of that time at new highs.
- That a stock near its low is cheap. A low price against the past year says the market has marked it down, not that the markdown is wrong.
- Why. The range is a fact about price. The reason, good or bad, is elsewhere.
In Stock Compass
Two rule indicators exist, both in percent:
- dist_from_52w_high_pct: how far below the 52-week high. "Less than 10" keeps stocks within 10 percent of their high, a common condition in momentum rules.
- dist_from_52w_low_pct: how far above the 52-week low. "Greater than 30" requires a stock to have come well off its low.
The high and low need a year of price history; a stock listed for less has a shorter range. For shorter windows there are 10, 20 and 60-day versions, but mind the sign: distance from the N-day high is negative (-5 means 5% below it) while distance from the 52-week high is positive (5 means 5% below it), so the same "< 10" means opposite things; and distance from the 20-day high has its own page. Stop chasing the market covers the difference between buying strength by rule and chasing it.
FAQ
Is it risky to buy a stock at its 52-week high?
Not more than at other times, on the evidence. A new high means the stock is in an uptrend and no recent buyer is waiting to get out at break-even. What matters is the plan for when it stops rising: a stop, and a position size that fits it.
Is a stock near its 52-week low a bargain?
Sometimes, but the low itself is not the evidence. It shows the market has repriced the company downward over the past year. Whether that is overdone is a question about the business and its valuation.
How is the distance from the 52-week high calculated?
The high minus the current price, divided by the high, times 100. A stock at 80 with a 52-week high of 100 is 20 percent below its high.
Definition only — not investment advice.