Predictive Power of Put-Call Ratios
February 27, 2013 - Equity Options, Sentiment Indicators
The conventional wisdom is that a high (low) ratio of equity put option volume to equity call option volume is bullish (bearish) because it indicates that investors are overly pessimistic (optimistic). Alternative measurements of the U.S. equity market put-call ratio are total options, index options and individual equity options. Index and equity option buyers may… Keep Reading