What is PUT CALL RATIO PCR ?
PUT CALL RATIO (PCR) The Put-Call Ratio is a commonly used financial indicator in options trading that measures the relative trading volume of put options to call options. It is calculated by dividing the total number of traded put options by the total number of traded call options. Put options are financial derivatives that give the holder the right, but not the obligation, to sell an underlying asset at a specified price (strike price) within a specified period of time. On the other hand, call options give the holder the right, but not the obligation, to buy an underlying asset at a specified price within a specified period. The Put-Call Ratio is used as a sentiment indicator to gauge the overall market sentiment or investor sentiment. It is based on the premise that put options are typically used as insurance or protection against potential price declines in the underlying asset, while call options are used to speculate on price increases. A high Put-Call Ratio indicates that there ...