In trading on Monday, shares of the SPDR Barclays Convertible Securities ETF (Symbol: CWB) entered into oversold territory, changing hands as low as $44.0593 per share. We define oversold territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In the case of SPDR Barclays Convertible Securities, the RSI reading has hit 28.6 - by comparison, the RSI reading for the S&P 500 is currently 33.3. A bullish investor could look at CWB's 28.6 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
Looking at a chart of one year performance (below), CWB's low point in its 52 week range is $31.04 per share, with $50.64 as the 52 week high point - that compares with a last trade of $44.16. SPDR Barclays Convertible Securities shares are currently trading down about 2.1% on the day.