Sentiment Indicators: Identifying Market Sentiment

Sentiment Indicators

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Question

All of the following are sentiment indicators Except:

Answers

Explanations

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A. B. C. D.

A

Sentiment indicators are used to gauge market sentiment or investor confidence, often by analyzing various market data points. The quick asset ratio, odd lot short ratio, shares sold short, and short interest ratio are all financial data points that can be used to gauge market sentiment, but only one of them is not considered a sentiment indicator.

A. Quick asset ratio: This ratio is a liquidity ratio that measures a company's ability to meet its short-term obligations using its most liquid assets. It is not considered a sentiment indicator as it does not provide any insight into market sentiment or investor confidence.

B. Odd lot short ratio: This ratio measures the number of short sales made in odd lots (less than 100 shares). It is considered a sentiment indicator because it reflects the activity of small investors, who are often seen as a contrarian indicator.

C. Shares sold short: This metric measures the total number of shares that have been sold short by investors. It is considered a sentiment indicator because it reflects investors' expectations of a decline in the stock's price.

D. Short interest ratio: This ratio measures the number of shares sold short divided by the average daily trading volume. It is considered a sentiment indicator because it provides an insight into how many days it would take for short sellers to cover their positions if there was a sudden change in the stock's price.

Therefore, the correct answer to the question is A. Quick asset ratio, as it is not considered a sentiment indicator.