Put-Call Ratio

What is the 'Put-Call Ratio'

The put-call ratio is a ratio of the trading volume of put options to call options. The put-call ratio has long been viewed as an indicator of investor sentiment in the markets. Times where the number of traded call options outpaces the number of traded put options would signal a bullish sentiment, and vice versa.

BREAKING DOWN 'Put-Call Ratio'

Technical traders have used the put call ratio for years as an indicator of the market. Most importantly, changes or swings in the ratio are seen as instances of great importance as this is commonly viewed as a change in the tide of overall market sentiment. By being able to get ahead of the tide, traders may be able to reap the rewards of taking positions at prices below future projections.

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RELATED FAQS
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    Learn about how the put-call ratio is calculated and interpreted, and discover where traders and analysts can obtain current ... Read Answer >>
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