DEFINITION of 'Advance/Decline Ratio ADR'
A marketbreadth indicator used in technical analysis to compare the number of stocks that closed higher with the number of stocks that closed lower than their previous day's closing prices. To calculate the advance/decline ratio, divide the number of advancing shares by the number of declining shares. The A/D ratio can be calculated for various time periods, such as one day, one week or one month.
BREAKING DOWN 'Advance/Decline Ratio ADR'
Investors can compare the moving average of the A/D ratio to the performance of a market index such as the NYSE or Nasdaq to see whether overall market performance is being driven by a minority of companies. This comparison can provide perspective on the cause of an apparent rally or selloff. Also, a low A/D ratio can indicate an oversold market, while a high A/D ratio can indicate an overbought market. Thus, the A/D ratio can provide a signal that the market is about to change directions.

Advances And Declines
The number of stocks that closed at a higher price than the previous ... 
Advance/Decline Line  A/D
A technical indicator that plots changes in the value of the ... 
Advance/Decline Index
A technical analysis tool that represents the total difference ... 
Ratio Analysis
A ratio analysis is a quantitative analysis of information contained ... 
Current Ratio
The current ratio is a liquidity ratio measuring a company's ... 
Combined Ratio
A measure of profitability used by an insurance company to indicate ...

Active Trading Fundamentals
Market Breadth: Advance/Decline Indicators
Thirty stocks make up the Dow Jones Industrial Average. If the Dow moves up 20 points, there's no way to tell from that number if the increase is the result of only one stock going way up or ... 
Investing Basics
Analyze Investments Quickly With Ratios
Make informed decisions about your investments with these easy equations. 
Trading Strategies
Key No.2: Advance/Decline Is Falling Down
Learn the best ways to foresee market corrections and how to profit from them. 
Technical Indicators
Calculating the Arms Index (TRIN)
The Arms Index is a technical analysis indicator that’s used to predict price movements in the market on an intraday basis. 
Trading Strategies
Market Strength: Advancers to Decliners
The advance/decline line (A/D) is a technical analysis tool and is considered the best indicator of market movement as a whole. Stock indexes such as the Dow Jones Industrial Average (DJIA) ... 
Forex
The Price To Earnings Ratio Explained
The price to earnings ratio is one of the most important ratios in investing. Find out how it is calculated, how it can be used and what it tells investors about a particular stock. 
Fundamental Analysis
4 Simple Investing Ratios You Need To Know
Dissecting a company’s financial statements to uncover ways to make money is a challenging endeavor. Here are four ratios that can help. 
Trading Strategies
Financial Ratios to Spot Companies Headed for Bankruptcy
Obtain information about specific financial ratios investors should monitor to get early warnings about companies potentially headed for bankruptcy. 
Professionals
Technical Analysis â€“ Other Indicators
Technical Analysis â€“ Other Indicators 
Investing Basics
3 Key Signs Of A Market Top
When stocks rise or fall, the financial fate of investors change, as well. There are certain signs that can reveal a stock’s course, and investors don’t need to be experts to spot them.

What are the main signals traders use from an Advance/Decline ratio?
Find out how traders and technical analysts employ the Advance/Decline ratio, and what values are considered important trading ... Read Answer >> 
How do stock dividends affect the retained earnings account?
Understand the difference between financial ratio analysis and accounting ratio analysis. Learn why ratio analysis is important ... Read Answer >> 
What role does ratio analysis play in valuing a company?
Learn about the role of ratio analysis in determining company value, including some of the most common ratios used by modern ... Read Answer >> 
How do I use ratios to perform a financial analysis?
Learn which ratios are used in fundamental analysis. Find out how analysts measure company performance and financial health ... Read Answer >> 
How does ratio analysis make it easier to compare different companies?
Learn what ratio analysis is, how investors can compare companies within the same sector using ratio analysis and how ratios ... Read Answer >> 
Which financial metrics are best for analyzing companies in the chemicals sector?
Learn about some of the key financial metrics that investors and market analysts commonly use to evaluate companies in the ... Read Answer >>