|
| Discuss Put-Call Ratio at the Options within the Traderji.com - Discussion forum for Stocks Commodities & Forex; Put-Call Ratio Put-call ratios are useful, sentiment-based, indicators. The put-call ratio ... |
|
|||||||
| Register | Blogs | FAQ | Chat Room | Search | Today's Posts | Mark Forums Read |
|
Welcome to the Traderji.com - Discussion forum for Stocks Commodities & Forex. You are currently viewing our boards as a guest which gives you limited access to view most discussions and access our other features. By joining our free community you will have access to post topics, communicate privately with other members (PM), respond to polls, upload content and access many other special features. Registration is fast, simple and absolutely free so please, join our community today! If you have any problems with the registration process or your account login, please read the FAQ. |
 |
|
|
Thread Tools |
| Sponsored Links |
|
#1
17th September 2004, 10:24 AM
|
|||
|
|||
Put-Call Ratio
Put-Call Ratio
Put-call ratios are useful, sentiment-based, indicators. The put-call ratio is simply the volume of all puts that are traded on any given day divided by the volume of calls that are traded on that day. The ratio can be calculated for an individual stock, index, or futures underlying contract, or can be aggregated. For example, we often refer to the equity-only put-call ratio, which is the sum of all equity put options divided by all equity call options on any given day. How to forecast Market Direction With Put/Call Ratios While most options traders are familiar with the leverage and flexibility that options offer, not everybody is aware of their value as predictive tools. Yet one of the most reliable indicators of future market direction is a contrarian-sentiment measure known as the put/call ratio. By tracking the daily and weekly volume of puts and calls in the stock market, we can gauge the feelings of traders. While too many put buyers (high put/call ratio) usually signals that a market bottom is nearby, too many call buyers (low put/call ratio) typically indicates a market top is in the making. How to bet against the crowd using the Put/Call Ratio It is widely known that options traders, especially option buyers, are not the most successful traders. On balance, option buyers lose about 90% of the time. Although there are certainly some traders who do well, would it not make sense to trade against the postions of option traders since most of them have such an abysmal record? The contrarian sentiment put/call ratio demonstrates that it does pay to go against the options trading "crowd." After all, the options crowd is usually wrong. Looking inside the market can give us clues about its future direction. Put/call ratios provide us with an excellent window into what investors are doing. When speculation in calls gets too excessive, the put/call ratio will be low. This indicates that a market top is in the making. When investors are bearish and speculation in puts gets excessive, the put/call ratio will be high. This indicates that a market bottom is in the making. The next time you hear talk about the put/call ratio in the media, trade against the general crowd. After all over 90% of derivative traders lose money. Last edited by TradingPicks : 17th September 2004 at 09:00 PM. 
|
|
#3
17th September 2004, 04:38 PM
|
|||
|
|||
|
Re: Put-Call Ratio
gvnarendra.
Very good article and a very sensible way of analysing the market. Keep it up. We expect more knowledgeble write up like this. Thanking you gvnarendra
|
|
#4
24th September 2004, 03:33 PM
|
|||
|
|||
|
Re: Put-Call Ratio
i appreciate what u said.
|
|
#5
21st July 2005, 11:39 PM
|
|||
|
|||
|
Re: Put-Call Ratio
To TradingPicks,
Thanks from my behalf for specifyin such an effective tool---- regards, joy_mitali
|
|
#6
23rd July 2005, 11:26 AM
|
|||
|
|||
|
Re: Put-Call Ratio
Joy-Mitali
thks for the article on the put-call ratio, is there some kind of thumb rules to predict whether the ration points to bull or bear. for eg: in nasdaq : P/C ratio: 0.75 - 1 : bullish 0.4 or lower: bearish 0.4 - 0.6 neutral could you share your experience in this for the indian market b rgds gopii
|
|
#7
23rd July 2005, 05:05 PM
|
|||
|
|||
|
Re: Put-Call Ratio
Thankyou for this information. But can anyone tell me where can I find the data or charts for put/call ratio...
|
|
| Thread Tools | |
|
|
Similar Threads for: Put-Call Ratio
|
||||
| Thread | Thread Starter | Forum | Replies | Last Post |
| Make money by writing call & put options | TATrader | Options | 31 | 20th September 2007 08:27 PM |
| Put Options to protect your stock portfolio | Mohan | Options | 7 | 9th August 2007 02:04 AM |
| To Calculate | uncle sam | Technical Analysis | 2 | 11th September 2004 07:54 PM |
| NEUTRAL Market Option Trading Strategies | TradingPicks | Options | 0 | 12th August 2004 10:22 AM |
| Bear & Bull Market Option Spreads | TradingPicks | Options | 0 | 12th August 2004 08:03 AM |
Indemnity, Disclaimer & Disclosure
Notice:
• By visiting Traderji.com you indicate your acceptance of our Forum
Rules Disclaimer & Disclosure and indemnify Traderji.com, its
associates and related parties of all claims howsoever resulting from
the usage of the forum.
• Disclaimer: Trading or investing in stocks & commodities
is a high risk activity. Any action you choose to take in the markets
is totally your own responsibility. Traderji.com will not be liable for
any, direct or indirect, consequential or incidental damages or loss
arising out of the use of this information.
• Disclosure: The information in this forum is neither an offer
to sell nor solicitation to buy any of the securities mentioned herein.
The writers may or may not be trading in the securities mentioned.
• All names or products mentioned are trademarks or registered trademarks of their respective owners.
General Content Disclaimer Notice:
In light of our policy of encouraging candid, open exchanges of views and the rapid distribution of information originating from many sources, Traderji.com cannot determine the accuracy of information that may be uploaded to the forum. Opinions, advice and all other information expressed by participants in discussions are those of the author. You rely on such information at your own risk. You are urged to seek professional advice for specific, individual situations and not rely solely on advice or opinions given in the discussions. Since Traderji.com is an open and free discussion forum, any comments made by members of this forum in their posts reflect their own views and not of the owner or administrator of Traderji.com. Thus the owner/administrator indemnify themselves of all claims whatsoever and will not be liable or responsible for any members comments/views in this forum Traderji.com. If you find any objectionable or offensive posts made by members of this forum which you would like to bring to our notice for removal then please Contact Us.
