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Put Call Ratio

INDEX

PCR OI

Symbol
Put
Call
Ratio

NIFTY

12,79,51,950

18,15,91,885.00

0.70

Note: OI Figures are in Thousands

PCR Volume

Symbol
Put
Call
Ratio

NIFTY

2,77,29,30,900

3,33,99,71,325.00

0.83

Note: Volume Figures are in Thousands

STOCKS

PCR OI

Symbol
Put
Call
Ratio

24,17,400

24,83,100.00

0.97

18,25,25,900

30,70,81,400.00

0.59

2,38,59,000

3,55,44,000.00

0.67

29,38,875

32,86,125.00

0.89

3,86,19,300

3,86,69,900.00

1.00

62,65,825

1,53,66,800.00

0.41

77,09,950

1,27,26,160.00

0.61

5,98,400

15,25,150.00

0.39

35,04,800

52,09,600.00

0.67

2,59,08,375

3,32,53,875.00

0.78

6,21,650

7,76,200.00

0.80

15,67,650

22,85,500.00

0.69

33,51,000

83,72,400.00

0.40

3,80,625

5,56,125.00

0.68

5,52,500

13,68,250.00

0.40

41,77,075

76,42,425.00

0.55

20,16,225

30,74,725.00

0.66

4,09,600

6,78,400.00

0.60

33,21,600

48,84,000.00

0.68

90,47,325

1,28,18,050.00

0.71

49,99,200

73,24,800.00

0.68

6,91,13,000

11,51,15,000.00

0.60

1,99,75,200

2,68,71,400.00

0.74

2,88,15,200

4,25,50,400.00

0.68

3,73,900

4,86,800.00

0.77

31,39,950

47,20,100.00

0.67

12,37,950

18,50,800.00

0.67

34,37,200

63,15,400.00

0.54

18,95,000

19,81,000.00

0.96

2,28,375

4,45,200.00

0.51

31,81,500

73,03,100.00

0.44

9,68,000

14,31,400.00

0.68

32,02,500

38,75,550.00

0.83

1,92,000

3,68,850.00

0.52

79,95,875

1,71,96,125.00

0.46

7,57,625

15,42,250.00

0.49

51,47,175

86,88,075.00

0.59

61,050

83,575.00

0.73

2,86,06,500

6,97,50,750.00

0.41

11,74,125

33,10,125.00

0.35

51,43,200

1,04,28,800.00

0.49

2,52,10,800

3,20,82,200.00

0.79

29,67,250

1,00,03,125.00

0.30

2,50,37,500

4,32,56,000.00

0.58

2,00,45,550

2,90,22,825.00

0.69

1,01,63,175

1,33,22,300.00

0.76

7,35,300

11,67,750.00

0.63

21,40,000

44,10,000.00

0.49

1,32,63,900

2,28,58,900.00

0.58

31,02,500

47,95,700.00

0.65

7,59,000

7,84,375.00

0.97

10,36,350

14,35,700.00

0.72

15,35,950

21,30,050.00

0.72

7,59,76,000

10,49,76,000.00

0.72

2,77,025

5,53,000.00

0.50

4,31,750

8,87,250.00

0.49

7,85,400

13,26,500.00

0.59

9,96,100

18,43,800.00

0.54

1,54,72,600

2,11,80,900.00

0.73

82,24,200

1,24,25,400.00

0.66

6,59,800

10,22,700.00

0.65

12,88,500

19,32,750.00

0.67

49,16,225

42,76,050.00

1.15

9,07,200

15,79,500.00

0.57

19,515

47,490.00

0.41

2,05,35,750

7,09,94,250.00

0.29

50,84,800

88,53,600.00

0.57

3,49,425

6,23,925.00

0.56

10,74,150

15,21,800.00

0.71

1,12,12,500

1,49,93,750.00

0.75

2,32,17,000

5,82,60,000.00

0.40

8,98,42,500

12,56,98,500.00

0.71

1,41,18,400

2,23,04,000.00

0.63

13,91,250

17,31,750.00

0.80

41,12,100

73,17,000.00

0.56

1,31,36,500

2,38,68,000.00

0.55

17,67,750

21,95,250.00

0.81

2,03,62,500

2,94,45,000.00

0.69

11,78,925

26,25,150.00

0.45

7,62,025

8,59,375.00

0.89

1,48,74,800

2,21,93,300.00

0.67

11,83,200

19,18,400.00

0.62

11,95,200

12,92,800.00

0.92

19,44,125

27,66,375.00

0.70

10,41,075

16,12,450.00

0.65

12,25,875

20,14,425.00

0.61

8,28,900

24,21,050.00

0.34

40,87,200

68,28,000.00

0.60

5,75,775

9,55,350.00

0.60

1,01,61,000

1,58,91,000.00

0.64

53,82,608

83,98,760.00

0.64

26,87,400

49,27,800.00

0.55

25,07,925

40,21,775.00

0.62

6,07,200

7,36,800.00

0.82

2,12,56,968

3,20,23,774.00

0.66

29,37,025

61,53,700.00

0.48

11,11,050

17,75,250.00

0.63

20,44,700

46,60,600.00

0.44

57,36,000

72,60,000.00

0.79

1,48,97,100

1,48,63,100.00

1.00

21,18,000

36,53,600.00

0.58

64,84,000

72,46,800.00

0.89

2,12,400

7,05,150.00

0.30

3,38,275

5,16,775.00

0.65

2,45,300

5,45,200.00

0.45

36,41,325

52,52,250.00

0.69

42,06,250

90,98,750.00

0.46

58,62,375

81,89,100.00

0.72

51,69,000

90,55,000.00

0.57

10,18,300

14,89,200.00

0.68

3,71,95,800

5,17,70,500.00

0.72

38,23,750

43,13,750.00

0.89

2,72,08,000

4,89,39,200.00

0.56

1,26,90,500

2,80,07,500.00

0.45

1,19,09,400

2,38,67,100.00

0.50

46,38,375

65,70,375.00

0.71

1,29,35,900

2,80,90,050.00

0.46

4,06,28,250

6,31,31,250.00

0.64

91,71,900

1,35,70,800.00

0.68

98,79,600

1,59,13,600.00

0.62

80,37,600

1,35,88,100.00

0.59

98,72,800

1,74,80,400.00

0.56

25,27,200

34,87,350.00

0.72

16,35,000

24,49,000.00

0.67

64,56,000

80,92,000.00

0.80

31,51,500

49,45,050.00

0.64

76,14,750

1,47,45,500.00

0.52

2,25,90,000

3,24,33,750.00

0.70

8,45,78,735

9,12,47,455.00

0.93

51,72,64,565

1,10,80,05,475.00

0.47

25,52,075

36,34,325.00

0.70

6,06,775

8,88,550.00

0.68

1,33,03,500

2,25,61,000.00

0.59

1,00,76,025

1,54,17,900.00

0.65

1,44,69,700

2,54,33,450.00

0.57

57,30,300

92,11,200.00

0.62

1,26,27,900

1,38,40,875.00

0.91

1,07,43,100

2,07,28,300.00

0.52

87,58,400

1,72,62,000.00

0.51

1,75,37,550

2,64,64,350.00

0.66

19,30,650

30,85,050.00

0.63

85,16,200

1,35,97,100.00

0.63

1,60,41,850

2,51,55,900.00

0.64

3,71,250

7,82,250.00

0.47

40,25,000

75,69,450.00

0.53

29,80,000

28,88,500.00

1.03

33,17,250

51,28,050.00

0.65

9,88,500

18,04,500.00

0.55

20,56,475

36,45,325.00

0.56

16,84,650

29,51,025.00

0.57

28,24,500

28,63,000.00

0.99

3,69,67,500

9,03,68,105.00

0.41

39,34,125

78,43,875.00

0.50

2,65,63,950

4,37,85,000.00

0.61

12,75,650

24,48,225.00

0.52

2,72,85,000

4,00,70,000.00

0.68

71,64,000

1,02,67,200.00

0.70

2,25,06,425

3,08,07,200.00

0.73

9,63,725

14,99,925.00

0.64

49,78,750

96,60,000.00

0.52

9,71,400

15,50,850.00

0.63

91,76,475

1,48,21,125.00

0.62

8,00,500

10,34,200.00

0.77

5,76,000

9,82,400.00

0.59

45,96,125

59,05,450.00

0.78

3,44,825

7,14,350.00

0.48

1,35,33,750

1,25,15,000.00

1.08

9,27,775

11,40,700.00

0.81

6,84,200

9,94,400.00

0.69

43,99,200

67,05,000.00

0.66

49,53,750

78,51,250.00

0.63

11,07,900

11,53,350.00

0.96

27,75,375

50,18,625.00

0.55

2,53,90,800

3,33,51,750.00

0.76

28,65,000

48,83,250.00

0.59

32,60,000

40,38,125.00

0.81

30,00,100

58,11,150.00

0.52

33,34,550

44,28,500.00

0.75

49,37,250

93,01,750.00

0.53

46,66,400

84,33,150.00

0.55

6,57,78,750

8,19,45,000.00

0.80

8,87,100

12,93,450.00

0.69

47,69,700

99,46,300.00

0.48

1,22,92,875

2,05,68,000.00

0.60

4,26,875

6,26,125.00

0.68

1,29,56,000

1,55,37,325.00

0.83

1,73,400

3,93,750.00

0.44

14,64,125

11,55,050.00

1.27

1,08,72,500

1,48,87,500.00

0.73

1,69,31,250

3,07,57,125.00

0.55

81,05,400

1,47,25,475.00

0.55

33,48,500

42,37,000.00

0.79

4,80,16,800

7,35,95,550.00

0.65

15,29,775

24,86,575.00

0.62

1,73,16,000

2,82,04,800.00

0.61

3,57,61,050

4,44,86,325.00

0.80

2,26,00,800

4,53,42,000.00

0.50

5,99,700

10,01,700.00

0.60

1,63,62,750

2,02,05,750.00

0.81

41,58,000

75,70,500.00

0.55

7,78,875

11,58,450.00

0.67

1,26,63,750

2,86,81,875.00

0.44

33,40,700

48,14,700.00

0.69

37,52,000

56,41,000.00

0.67

17,95,500

40,18,875.00

0.45

13,03,050

29,28,675.00

0.44

49,97,000

81,36,000.00

0.61

1,00,87,500

1,34,00,000.00

0.75

10,38,500

15,94,500.00

0.65

17,15,700

22,84,450.00

0.75

20,29,500

32,83,250.00

0.62

66,64,350

90,95,100.00

0.73

95,000

1,74,600.00

0.54

2,13,125

3,93,250.00

0.54

59,37,975

71,61,575.00

0.83

36,69,600

62,51,400.00

0.59

70,15,500

73,73,100.00

0.95

19,95,300

28,22,175.00

0.71

12,01,500

17,13,900.00

0.70

1,72,40,600

2,64,47,200.00

0.65

1,39,15,900

2,15,57,400.00

0.65

5,76,625

12,65,375.00

0.46

34,33,075

69,96,000.00

0.49

4,12,500

6,38,000.00

0.65

Note: OI Figures are in Thousands

PCR Volume

Symbol
Put
Call
Ratio

9,81,900

20,29,500.00

0.48

7,43,29,000

7,90,56,200.00

0.94

1,98,63,000

3,55,80,000.00

0.56

8,40,000

30,75,375.00

0.27

17,54,10,650

16,00,24,800.00

1.10

74,29,200

3,28,02,050.00

0.23

24,28,160

50,78,540.00

0.48

9,06,400

24,22,750.00

0.37

6,32,000

18,23,600.00

0.35

4,91,44,050

8,68,84,875.00

0.57

3,86,700

10,19,500.00

0.38

5,16,250

9,49,200.00

0.54

29,25,100

69,08,300.00

0.42

3,75,000

3,62,625.00

1.03

1,81,250

6,63,250.00

0.27

38,33,550

79,12,450.00

0.48

5,29,250

16,39,225.00

0.32

56,000

2,71,200.00

0.21

21,42,000

33,46,800.00

0.64

98,72,625

1,60,03,050.00

0.62

14,72,800

26,75,200.00

0.55

13,05,48,000

24,03,61,000.00

0.54

1,09,28,650

2,41,14,950.00

0.45

1,25,49,600

2,36,63,200.00

0.53

3,41,600

5,65,900.00

0.60

10,63,150

35,12,300.00

0.30

4,37,500

10,81,150.00

0.40

6,54,550

16,23,700.00

0.40

5,82,000

10,44,000.00

0.56

42,700

5,86,950.00

0.07

54,61,400

74,38,900.00

0.73

6,51,200

13,58,600.00

0.48

43,76,400

61,54,050.00

0.71

1,11,600

1,90,650.00

0.59

16,09,750

89,94,625.00

0.18

7,45,250

13,64,750.00

0.55

28,17,375

1,04,13,975.00

0.27

15,375

43,200.00

0.36

1,68,74,250

3,57,60,000.00

0.47

5,25,750

15,19,500.00

0.35

40,80,000

1,31,52,000.00

0.31

3,54,47,400

3,52,82,900.00

1.00

13,26,875

49,25,250.00

0.27

6,06,14,000

9,38,98,500.00

0.65

42,92,925

1,30,35,600.00

0.33

2,79,400

5,65,150.00

0.49

6,16,950

18,44,550.00

0.33

14,62,500

84,47,500.00

0.17

49,03,900

1,43,22,200.00

0.34

3,55,300

7,83,700.00

0.45

7,26,625

12,19,625.00

0.60

3,77,300

11,22,450.00

0.34

4,47,200

11,83,650.00

0.38

2,89,60,000

5,61,60,000.00

0.52

83,475

2,85,775.00

0.29

1,95,000

7,29,000.00

0.27

47,02,250

34,05,500.00

1.38

29,26,000

1,56,93,300.00

0.19

70,98,000

1,69,78,000.00

0.42

18,01,800

48,06,000.00

0.37

7,00,000

10,26,800.00

0.68

5,60,250

30,40,500.00

0.18

21,31,500

29,98,600.00

0.71

5,43,300

9,46,200.00

0.57

11,190

39,300.00

0.28

1,56,17,250

3,40,92,000.00

0.46

19,68,400

44,10,000.00

0.45

1,41,150

3,24,750.00

0.43

4,65,150

5,93,250.00

0.78

1,95,87,500

5,75,84,375.00

0.34

1,67,94,000

4,54,45,500.00

0.37

2,79,58,500

6,37,33,500.00

0.44

75,77,600

3,06,94,400.00

0.25

5,90,000

13,15,250.00

0.45

27,59,400

62,45,100.00

0.44

23,59,500

69,03,000.00

0.34

7,06,875

15,09,375.00

0.47

1,37,43,750

2,18,47,500.00

0.63

2,71,425

5,20,575.00

0.52

4,26,525

5,92,350.00

0.72

72,44,700

1,37,02,200.00

0.53

5,00,400

10,66,800.00

0.47

7,38,400

8,13,600.00

0.91

17,38,750

29,87,625.00

0.58

2,87,525

12,81,175.00

0.22

19,69,275

27,63,600.00

0.71

6,59,950

17,83,400.00

0.37

28,45,200

70,46,400.00

0.40

29,65,725

1,44,79,875.00

0.20

97,11,000

1,94,94,000.00

0.50

11,69,864

24,54,864.00

0.48

13,40,400

42,57,800.00

0.31

32,99,700

96,76,400.00

0.34

4,20,000

5,10,300.00

0.82

1,28,77,332

2,27,29,428.00

0.57

8,27,750

28,48,475.00

0.29

6,35,850

25,05,600.00

0.25

7,50,400

25,29,800.00

0.30

9,75,000

21,50,000.00

0.45

1,71,64,900

2,72,35,700.00

0.63

4,33,600

11,82,800.00

0.37

46,50,000

71,87,200.00

0.65

1,87,200

10,08,450.00

0.19

3,99,700

5,93,250.00

0.67

4,71,500

23,99,100.00

0.20

85,61,050

2,54,83,400.00

0.34

12,47,500

35,55,000.00

0.35

46,41,300

64,21,275.00

0.72

44,32,000

95,81,000.00

0.46

2,01,450

6,64,700.00

0.30

4,69,62,400

10,97,92,000.00

0.43

31,18,750

46,34,375.00

0.67

1,65,79,200

3,24,46,400.00

0.51

62,22,000

1,37,27,500.00

0.45

52,99,200

1,49,79,900.00

0.35

38,09,750

1,39,67,625.00

0.27

25,10,125

1,10,32,875.00

0.23

3,03,85,875

7,39,97,625.00

0.41

9,41,700

28,02,525.00

0.34

64,50,800

1,18,80,400.00

0.54

26,91,100

77,18,000.00

0.35

48,81,800

1,11,42,600.00

0.44

10,38,600

31,04,100.00

0.33

1,95,000

7,22,000.00

0.27

43,81,000

93,58,000.00

0.47

29,05,650

58,22,850.00

0.50

43,61,500

1,13,98,750.00

0.38

8,28,03,750

17,80,87,500.00

0.46

1,77,61,625

3,78,14,175.00

0.47

4,37,42,700

21,15,66,000.00

0.21

33,54,975

1,18,32,600.00

0.28

2,63,575

3,60,425.00

0.73

1,08,98,300

2,05,75,800.00

0.53

47,14,725

1,14,57,975.00

0.41

3,07,90,375

3,30,72,550.00

0.93

63,33,900

1,68,00,600.00

0.38

93,69,675

1,09,06,650.00

0.86

4,49,78,450

6,00,96,700.00

0.75

2,19,05,800

2,92,32,000.00

0.75

28,38,000

1,83,88,950.00

0.15

8,12,850

24,03,000.00

0.34

23,29,800

66,25,300.00

0.35

1,40,26,100

2,20,64,900.00

0.64

3,78,450

12,21,150.00

0.31

67,73,900

1,05,11,200.00

0.64

20,98,000

24,43,500.00

0.86

23,76,150

48,15,750.00

0.49

4,51,500

13,89,500.00

0.32

11,19,075

16,80,225.00

0.67

24,21,650

31,92,750.00

0.76

40,79,000

78,49,000.00

0.52

6,60,74,175

27,15,15,825.00

0.24

24,81,375

63,85,500.00

0.39

3,64,83,300

6,33,21,300.00

0.58

5,28,550

15,11,250.00

0.35

62,30,000

1,68,45,000.00

0.37

13,50,000

42,31,800.00

0.32

2,06,07,650

2,85,34,975.00

0.72

4,73,900

8,14,800.00

0.58

46,01,250

63,08,125.00

0.73

4,49,100

11,10,000.00

0.40

66,84,150

1,62,23,625.00

0.41

22,70,200

54,37,850.00

0.42

5,09,900

13,29,600.00

0.38

1,25,68,275

3,05,14,950.00

0.41

1,70,625

3,42,225.00

0.50

1,43,75,000

3,39,75,000.00

0.42

6,92,750

9,86,425.00

0.70

9,54,000

40,44,200.00

0.24

11,30,400

32,95,800.00

0.34

50,81,250

1,70,78,750.00

0.30

2,43,900

10,01,250.00

0.24

13,84,125

26,18,625.00

0.53

74,04,750

1,91,30,850.00

0.39

20,00,250

33,40,875.00

0.60

23,80,000

71,81,250.00

0.33

8,91,100

28,76,600.00

0.31

11,27,950

21,19,050.00

0.53

11,81,750

43,60,875.00

0.27

24,80,925

68,53,775.00

0.36

1,34,59,500

2,29,16,250.00

0.59

3,45,900

11,55,000.00

0.30

9,91,900

23,30,900.00

0.43

2,25,32,625

4,49,39,625.00

0.50

2,39,625

6,26,625.00

0.38

1,14,47,100

1,71,86,450.00

0.67

2,54,800

10,03,350.00

0.25

3,48,400

11,22,225.00

0.31

1,10,42,500

2,18,20,000.00

0.51

1,70,52,000

4,36,03,875.00

0.39

92,42,075

1,34,15,900.00

0.69

20,19,000

38,68,000.00

0.52

3,02,15,700

5,10,12,150.00

0.59

9,00,900

24,98,275.00

0.36

29,43,200

1,09,20,000.00

0.27

1,37,12,400

2,04,10,650.00

0.67

65,55,600

2,16,25,200.00

0.30

1,97,100

2,88,000.00

0.68

1,31,81,250

3,09,71,250.00

0.43

26,79,000

53,93,500.00

0.50

3,23,400

6,72,000.00

0.48

63,14,375

1,64,03,750.00

0.38

42,92,200

70,63,100.00

0.61

13,89,000

31,54,000.00

0.44

4,45,375

14,40,250.00

0.31

3,00,050

10,52,300.00

0.29

1,02,14,750

2,54,59,750.00

0.40

53,42,500

65,95,000.00

0.81

10,65,750

14,08,000.00

0.76

6,05,850

11,38,200.00

0.53

21,88,500

55,95,000.00

0.39

16,52,700

40,51,950.00

0.41

1,06,400

4,00,600.00

0.27

1,01,875

2,83,125.00

0.36

20,21,600

42,82,125.00

0.47

17,79,000

53,53,800.00

0.33

18,57,300

49,68,900.00

0.37

13,45,950

67,43,250.00

0.20

5,12,700

16,51,500.00

0.31

36,63,400

2,13,85,000.00

0.17

43,24,500

1,02,17,600.00

0.42

2,39,500

12,81,375.00

0.19

7,43,325

20,86,875.00

0.36

5,98,500

6,15,000.00

0.97

Note: Volume Figures are in Thousands

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What is the Put Call Ratio?

The PCR is a common technical indicator used to measure the traded volume for put options in comparison with call options. The usage of PCR facilitates the analysis of the market's sentiment and further possible movements in prices. With higher values of PCR, a bearish market arises. Low PCR or very low PCR signals the formation of a bull market. In this way, the PCR explains the amount of optimism or pessimism present in the market.

How is PCR Calculated?

PCR can be calculated in two ways:

Based on open interests of a given day
The PCR ratio is the total sum of outstanding open interest in put options for a selected security or market divided by the total of outstanding open interest in call options for that given market. Open interest is said to be the total sum of options contracts remaining unexercised and also those that did not expire.

Formula
PCR = Total open interest of put options / Total open interest of call options

Example
Assume we need to determine the put call ratio for "ABC Ltd," traded on the NSE. Total open interest for put options on ABC Ltd: 2,000 contracts. The total open interest for call options on XYZ Ltd: 5,000 contracts.
Using the formula: PCR = 2,000 (Put options) / 5,000 (Call options) = 0.4
So, the put-call ratio for ABC Ltd is 0.4.

According to the trading volume of a given day
The PCR ratio can also be derived by using the investing volume of put options and call options on a given day. This brings one nearer to getting an idea about the prevailing market mood through the trading volume that takes place during that particular day.

Formula
PCR = Total trading volume of Put options / Total trading volume of Call options

Example
Let us take the trading volume of any day of "ABC Ltd." in the BSE. The total trading volume of put options on ABC Ltd is 4,000 contracts, and the total trading volume of call options on ABC Ltd is 16,000 contracts.
By using this formula: PCR = 4,000 (Put options) / 16,000 (Call options) = 0.25
So, the PCR for ABC Ltd on that particular date is 0.25.

How to Analyse PCR (Put Call Ratio)

Here's a breakdown of PCR analysis depending on different scenarios:

  • Scenario: The Nifty PCR rises as small declines are bought into an upward-rising market
    Signal: Positive
    Interpretation: It means that the upswing is expected to continue as put writers are actively engaged in writing during dips.
  • Scenario: The PCR falls low as markets are gauging the levels of resistance
    Signal: Bearish
    Interpretation: It reflects that call writers are opening fresh positions expecting either a market pullback or restricted upside.
  • Scenario: The PCR is dropping in a declining market
    Signal: Bearish
    Interpretation: This means that option writers are selling call option strikes aggressively.

How to Trade Using a Put-Call Ratio

The rules and guidelines for PCR trading are as follows:

  • Identify Extremes: Look at the historical PCR values where the ratio reaches extreme values. Extreme peaks often mark overbought bearishness, which is typically taken back with a bullish reversal. Downside extremes may mark overbought bullishness, which is often taken back through the market pullback.
  • Use the PCR in Combination with Other Indicators: Most traders prefer to use PCR technically combined with other technical indicators. They tend to combine PCR either with moving averages or with the Relative Strength Index (RSI) in order to confirm the signals arising from PCR. This happens mainly to eliminate false interpretations and enhance strong trading decisions.
  • Market Context: Always look at the broader market context. If the PCR is high for an extended period of a downtrend, it may only be extending the bearish outlook. Conversely, this level of PCR in a sideways market might only suggest an oversold state.

Why is PCR Important?

PCR is one of the most significant measures that traders use when gauging market sentiment. The PCR live helps traders identify the underlying price movement of the security and guides them through placing directional bets on equities. As a contrarian signal, it helps traders avoid the pitfall of herd mentality. Another way in which the Put/call ratio is used to study overall trading activity by market players is that it measures in terms of both open interest and volume.

Advantages of Put Call Ratio

  • Market Sentiment: PCR captures a snapshot of market sentiment and helps to trade towards a bullish or bearish interpretation from the market perspective.
  • Contrarian Indicator: It behaves as a contrarian sign. An extremely high or low PCR may indicate the approach of mood change in the market or an upbeat or depressive attitude.
  • Risk Management: Tracking PCR helps traders understand risks and make better decisions. A bearish PCR may lead to protective action, whereas a bullish PCR encourages greater risk-taking activities.
  • Volatility Indicator: As many traders and investors are buying put options as some form of hedging against the negative risks that may prevail, a higher rise in PCR is generally linked with increased market volatility.
  • Leading Indicator: The PCR can sometimes act as a leading indicator when extreme levels are reached.

Disadvantages of Put Call Ratio

  • Subjective Interpretation: The determination of what constitutes an "extreme" level would be subjective and may vary from trader to trader.
  • False Signals: As with any indicator, the PCR can produce false signals, especially if used without any other technical or fundamental analysis metrics.
  • Lagging Nature: The PCR reflects previously traded option activity that doesn't necessarily translate into near-term price movement.
  • Market Context Dependence: The relevance of the readings might depend on the range, trend, or reversal stage that the market finds itself in.

4 Ways to Interpret 'Nifty Put Call Ratio Live Chart' and Nifty Spot Correlation

  • Trend Confirmation: A positive PCR amplified by increasing Nifty spot price would confirm that the bull trend is not over yet.
  • Reversal Signal: An extremely high PCR accompanied by a falling Nifty spot price could be a hint that the market is oversold and due for a reversal.
  • Bearish Divergence: When the PCR goes upwards, in contrast, the Nifty prices do not move up or go down, which indicates that more bullish sentiment turns bearish.
  • Bullish Divergence: It is a situation in which the PCR goes down, but the Nifty spot price shows as steady or rising. This might reflect that bearish sentiment is dropping, and bullish momentum may start rising.

Interpretation of PCR

  • PCR < 1: It suggests that more open call contracts are present than put contracts. It also means a bullish market sentiment where traders and investors believe the price of the underlying asset will rise.
  • PCR > 1: If PCR is greater than 1, then the number of put contracts is higher compared to the number of call contracts, and hence, it portrays a bearish market psychology. The traders, as well as investors, think that the value of the underlying asset will go down.
  • PCR = 1: When the PCR stands about 1, this usually indicates market opinion is fairly neutral since there is little crowd psychology geared toward shorting or longing, and a greater number of investors and traders have equally bullish and bearish opinions.

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FAQs

What constitutes a high PCR?

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A high PCR is typically above 1.0, meaning that the number of put options traded is higher than the call options.

What does a Put Call Ratio greater than one indicate?

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If the PCR is more than one, it then means that there have been more purchases of puts than calls by the traders, which means that the current market situation is bearish.

What is the ideal PCR ratio?

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It's likely that market volatility, earnings reports, economic events, and general market sentiment would all impact PCR.

What factors can affect the PCR ratio?

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It's likely that market volatility, earnings reports, economic events, and general market sentiment would all impact PCR.

Is a high put-call ratio good?

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It depends on perspective. A high PCR may indicate excessive bearishness, which contrarian traders may see as a bullish signal.

What is a bullish put-call ratio?

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A low PCR, generally below 0.7, is considered bullish as it reflects higher call option trading.

Is the put-call ratio a reliable measure to forecast future market conditions?

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While PCR can provide insights, it should be used alongside other indicators and analysis for more reliable forecasting.

How can I determine PCR results?

downArrow

PCR results can be tracked using financial data platforms that provide real-time options trading volumes and comprehensive charts.

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