Put-call ratio
The put-call ratio , or put-call ratio (PCR) is one in securities trading on the timing indicators to evaluate securities .
It gives the ratio of traded put options to call options on.
- .
If put options outweigh the prevailing opinion, this indicates negative market sentiment ( stock market sentiment ). If, on the other hand, purchase options predominate, this indicates positive market sentiment from this point of view. In fact, a rise in prices can often be observed after high put-call ratios. The PCR is therefore considered a contra-indicator. It should be noted that under normal conditions fewer put options than purchase options are in demand; a balanced PCR close to 1 is therefore already a sign of a slightly negative market sentiment.
The put-call ratio is a widely used sentiment indicator. This is determined every half hour at the Chicago Board Options Exchange (CBOE). In Germany you can see the PCRs on the websites of the Frankfurt and Stuttgart stock exchanges.
There are two ways in which the PCR can be calculated: according to volume (number of options traded) or according to the amount of money. Usually the PCR is calculated based on volume. However, in the opinion of some analysts, the calculation based on the money supply is more meaningful, as it evaluates how much money is actually invested.
Individual proof
- ↑ See Nasser Saber 1999, p. 121f.
literature
- Nasser Saber: Speculative Capital. Volume 1: The Invisible Hand of Global Finance. Financial Times et al., London 1999, ISBN 0-273-64155-7 .
- Nasser Saber: Speculative Capital. Volume 2: The Nature of Risk in Capital Markets. Financial Times et al., London 1999, ISBN 0-273-64422-X .
- Nasser Saber: Speculative Capital. Volume 3: The Enigma of Options. SaberSystem. 2006, ISBN 0-9771790-2-8 .