|
PureBytes Links
Trading Reference Links
|
There was a question yesterday concerning the put-call ratio. Since
I've seen no other answers I'll chip in. Sorry I've mislaid the
original message.
>From "Options as a Strategic Investment" by Lawrence McMillan - 3rd.
edition, 1993.
"The put-call ratio is simply the number of puts traded divided by the
number of calls traded. It can be computed daily, weekly, or over any
other time period. It can be computed for stock options, index options,
or futures options. Sometimes it is computed using open interest
instead of volume. If it is calculated daily, one usually averages
several days worth of figures to smooth out the fluctuations."
Under the heading of More Than You Wanted to Know: from "Winning on Wall
Street" by Martin Zweig - 1990. "It was shortly after finishing my
dissertation that I invented the puts/calls ratio". ... "It was
gratifying to be right again, and it made me even more eager to write
another article. The next one was on the puts/calls ratio, to which I
referred previously. This came out in the spring of 1971, when that
indicator had just turned bearish. For the next seven months the market
went down, and again I had hit the nail on the head".
|