Prevent Unauthorized Transactions in your demat / trading account Update your Mobile Number/ email Id with your stock broker / Depository Participant.As the ratio is calculated both in terms of open interest and volume, the entire trading behaviour of market participants can be analysed using the Put/call ratio. Being a contrarian indicator, it helps traders not to get trapped with Herd Mentality. Put/call ratio help traders decide the price movement of an underlying security and guides them to place directional bets on the stocks. Put/Call ratio is an important tool used by traders to gauge the overall sentiment of the market. Furthermore, Call volumes are used to indicate the total initiated Call options over Put volumes are the financial market indicator for the total initiated Put option over a specific PCR (Volume) = Put trading volume/Call trading volume Here, PCR is calculated by dividing the total Put trading volume by the total call trading PCR (OI) = Put open interest/Call open interest b. PCR is calculated by dividing the current open interest in a Put contract on a specificĭay by the open Call interest on the very same day. Based on Open Interests of a specific day The interpretation of this ratio differs as per the type of investor. It means option writers are aggressively selling the call option strikes. If put-call ratio decreases during down trending marketīearish indication. It means call writers are building fresh positions, expecting a limited upside or a correction in the market. If put-call ratio decreases while markets testing the resistance levelsīearish Indication.
It means the put writers are aggressively writing at dips expecting the uptrend to continue If put-call ratio increases as minor dips getting bought in during an up trending marketīullish Indication.
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