CBOE Put/Call Ratio

Prev Question Next Question

Question

The CBOE put/call ratio -

Answers

A. is used by contrary-opinion technical analysts. They view a ratio of 1.00 or greater to be a bearish sign. The value of the ratio has historically been in the 0.25 to 0.75 range, but has now moved considerably higher.

B. is used by technical analysts who try to follow the "smart money." They view a ratio of .90 or greater to be a bearish sign. The value of the ratio has historically been in the 0.30 to 0.85 range, but has now moved considerably higher.

C. is used by contrary-opinion technical analysts. They view a ratio of 0.70 or less to be a bearish sign. The value of the ratio has historically been in the 0.35 to 0.80 range, but has now moved considerably higher.

D. is used by technical analysts who try to follow the "smart money." They view a ratio of 0.60 or less to be a bullish sign. The value of the ratio has historically been in the 0.40 to 0.90 range, but has now moved considerably lower.

Show Answer

Explanations

Click on the arrows to vote for the correct answer

A. B. C. D.

The Chicago Board Options Exchange (CBOE) put/call ratio is used by contrary-opinion technical analysts. A higher ratio of puts to calls indicates a bearish market sentiment, while a lower ratio indicates the opposite. Contrary-opinion analysts believe that the sentiment is wrong, and assume ahigher ratio value is bullish while a low value is bearish. Currently, ratio values of 0.70 or less are viewed bearishly, while ratio values of 0.90 or greater are viewed bullishly.

Prev Question Next Question