Put Call Ratio Live

Last updated on 
July 26, 2024 | 11:31 AM

The put call ratio is a key indicator in option trading, comparing the number of call options purchased to the number of put options. It helps investors make informed trading decisions.

Nifty 50
01-Aug-2024
08-Aug-2024
14-Aug-2024
22-Aug-2024
Call OI
Put OI
PCR OI
2,47,30,675
3,46,79,125

1.4

Call Vol
Put Vol
PCR Vol
3,80,13,000
5,12,49,000

1.35

Historical PCR Of Nifty 50

DatePCR
25-07-20240.923
11-07-20240.759
04-07-20240.889
18-07-20241.191
27-06-20246.451

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Stock Option Chain Data

Stock
Index

Select Expiry Date

SymbolPut (OI)Call (OI)Ratio (OI)Put (Vol)Call (Vol)Ratio (Vol)
IDEA42,64,80,00079,10,00,0000.5439,37,20,0001,49,86,40,0000.26
IDFCFIRSTB8,14,35,00011,82,67,5000.698,24,77,50020,19,45,0000.41
TATASTEEL6,42,51,0008,82,03,5000.738,47,88,00017,50,59,5000.48
CANBK6,16,81,5007,62,27,7500.817,83,54,00018,70,42,5000.42
GMRINFRA4,60,80,0006,36,63,7500.727,54,87,50016,45,08,7500.46
IOC3,81,12,7505,76,07,8750.663,89,31,7508,38,79,2500.46
PNB4,67,60,0005,56,56,0000.844,29,12,00010,67,12,0000.4
BEL3,37,66,8004,84,47,1500.73,35,01,7507,63,08,7500.44
FEDERALBNK2,42,50,0004,58,65,0000.536,39,30,00014,65,70,0000.44
HDFCBANK2,14,42,8504,33,98,8500.493,88,27,2507,63,55,9500.51
ASHOKLEY3,05,25,0003,79,60,0000.812,52,30,00025,82,80,0000.48
ITC2,52,68,8003,45,27,6000.735,09,12,00011,54,24,8000.44
ONGC1,98,27,5003,21,89,8500.623,12,11,9506,71,15,1250.47
GAIL1,90,32,0003,21,75,9750.592,81,49,9755,54,67,3000.51
BANKBARODA2,85,59,7003,10,34,2500.922,33,26,8755,67,97,6500.41
VEDL2,14,75,1002,97,39,0000.724,08,29,6008,68,29,6000.47
WIPRO1,53,36,0002,96,85,0000.523,80,95,5009,45,33,0000.4
BANDHANBNK2,15,54,4002,79,21,6000.773,31,91,2006,64,35,6000.5
NTPC1,55,80,5002,74,74,0000.572,77,81,5006,20,20,5000.45
IEX1,55,13,7502,68,35,0000.581,08,48,7502,55,11,2500.43
Symbol

What is the Put Call Ratio?

Typically, a put-call ratio is a derivative indicator. It is intended to help traders accurately assess the sentiment of the options market. This ratio is calculated by factoring in open interest for a certain period or using the volume of options trading.  
 

This ratio, often known as PCR, is a contrarian indicator that focuses on option buildup. This type of indication aids in determining the degree to which the market is bullish or bearish.
 

In other words, it helps traders determine if a recent market surge or decline is excessive. 
 

Based on this knowledge, traders determine whether to take a contrarian position in the current market.
 

To avoid mispricing in the securities market, such an investment strategy is based on the practice of acquiring or selling investment units in response to current market conditions.

How to Analyse PCR (Put Call Ratio) ?

Let us examine the interpretation of PCR analysis with option sellers, the dominant participants in the market, in mind, in contrast to the general public, who typically participates in the purchasing side of the transaction.
 

Put / Call RatioInterpretation

If the Nifty put call ratio

 rises when little declines are purchased into an upward-rising market

A positive indication. In anticipation of the upswing continuing, it indicates that put writers are actively writing during dips.
If the put-call ratio falls as the markets are assessing the levels of resistanceA bearish signal. It indicates that call writers are opening new positions in anticipation of either a market pullback or a restricted upside.
If the put-call ratio falls in a market that is heading downwardBearish signal. It indicates that call option strikes are being aggressively sold by option writers.

How is PCR Calculated?

The interpretation of the put-call ratio (PCR) varies depending on the type of investor. Here is the call ratio formula:

Based on Open Interest of a Specific Day:

PCR is determined by dividing the current open interest in put contracts by the open interest in call contracts on the same day.


PCR (OI) = Put open interest/Call open interest

Based on the Volume of Options Trading:

PCR is calculated by dividing the total trading volume of puts by the total trading volume of calls on a specific day.

PCR (Volume) = Put trading volume/Call trading volume

Put volumes indicate the total initiated put options over a specific time frame, while call volumes represent the total initiated call options over that period.

Why Is PCR Important?

The put/call ratio is an essential metric that traders use to evaluate market sentiment. PCR ratio live assists traders in determining the price movement of the underlying security and guiding them to put directional bets on equities. As a contrarian signal, it helps traders avoid the trap of Herd Mentality. The Put/call ratio is also used to examine the whole trading activity of market players because it is computed in terms of both open interest and volume.

Advantages of Put Call Ratio & Disadvantages of Put Call Ratio

Here are the advantages and disadvantages of put call ratio:
 

Advantages of Put Call Ratio

Disadvantages of Put Call Ratio

Market Sentiment: Provides a snapshot of market sentiment, helping traders and investors understand whether the market is leaning towards bullish or bearish sentiment.Inaccuracy: The PCR does not give precise price goals or market movement timeframes. Although it may not forecast exact market moves, it provides an overview of the sentiments.
Contrarian Indicator: Functions as a contrarian signal. Extreme PCR readings, either very high or very low, may signal an impending turnaround in the market mood or an optimistic or gloomy outlook.Options Expiration: As options go closer to expiration, the PCR may be affected. Options have the potential to temporarily affect market sentiment when they expire by skewing the ratio.
Risk Management: By tracking the PCR, traders can assess the risk and make more informed decisions. A bearish PCR may lead to protective actions, while a bullish PCR encourages risk-taking.Over-reliance: It might be dangerous to base all of your trading decisions only on the PCR. Other aspects, such as technical and fundamental analysis, must be taken into account.
Volatility Indicator: Since more traders and investors are purchasing put options as a hedge against possible negative risks, an increase in PCR is frequently linked to higher market volatility.Different Interpretations: Because the PCR is only one indication out of many employed in the market, experts' interpretations of it might differ.
Leading Indicator: When extreme levels are attained, the PCR may occasionally serve as a leading indication of market moves.

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FAQs on PCR Ratio

High PCR indicates excessive put purchasing by small and medium-sized investors, as well as aggressive selling by more experienced traders.

There is no defined number; instead, previous data must be compared, such as one-month or three-month averages. PCR, like the other technical and derivative indicators, should be utilized in conjunction with them and understood in light of the present market condition.

A Put Call Ratio larger than one means that the market has traded more puts. This might indicate a gloomy market mood. Because traders expect a market downturn, they are trading put options rather than call options.

The ideal PCR ratio may vary depending on the specific experimental conditions and the desired level of amplification. However, a PCR ratio close to 1:1 (input:output) is often considered ideal for efficient and unbiased amplification.

Several factors can influence the PCR ratio, including the quality and quantity of starting material, primer design, PCR conditions (such as annealing temperature and cycle number), and the efficiency of the polymerase enzyme.

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