Put-Call Ratio

[hirenb]

i want data of putcall ratiosof nifty from 2002 to 2009

 

[saran.shivank]

Hi!!
I want some help with put and call option...i trade with sharekhan..i would like to ask..
example: if i buy a lot of 50 of nifty 4500 @ 100...and it goes upto 150 the same day. can i square it off and book my profits? and will the profit be: 50*50= 2500/- ???
Also, wt do i select for intraday- GFD or IOC???
I will be =greatful if sumbody cud help...

Regards,

 

[GLOBAL MONEY]

It was reallt an excellent write-up
Thanx

 

[GLOBAL MONEY]

Hi!!
I want some help with put and call option...i trade with sharekhan..i would like to ask..
example: if i buy a lot of 50 of nifty 4500 @ 100...and it goes upto 150 the same day. can i square it off and book my profits? and will the profit be: 50*50= 2500/- ???
Also, wt do i select for intraday- GFD or IOC???
I will be =greatful if sumbody cud help...

Regards,

Hi Shirank,
That calculation of urs is right, profit will be 50*50=2500 and u can square off any of ur position at any time till expiry

 

[abyscorporate]

Sharekhan provides Derivative info kit.U can find it in the Sharekhan website.

 

[vvek23]

Simplistically put can we say that when puts are more , put writers are more , which means they expect the buyer to buy a put hoping that he will never exercise the put option bought , this is exactly when the buyer of puts would get opporunity to sell higher , then why the hell should he exercise the put option , which means the writer of put option or in other words the seller has a view that market will move up and hence he is interested to write more puts and vice versa . Vivek

 

[pat.harsh]

Hi,

Thank you very much for this wonderful article it really helps. I am a rookie in the technical & fundamental analysis, Basically i am an arbitrauger by profession and now i want to to Jobbing (intra-day Trades) & positional trades... but dont where to get started with Technical analysis and trading methodology, cause there are so many books, i cant read them all and I wont to dedicate my time in learning something useful & practical, can you recommend few books to get me started.

Thanking you.
Harshit Patel

 

[Best of Luck]

Is it possible to make pcr as ascii file and charts can be made ?

 

[priyesh.kannan]

clearly explained thanks

 

[Gaur_Krishna]

Good thread for Put Call Ratio. Thanks DanPickUp bro for guiging to this

Regards,
Gaur_Krishna

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.