11.33What is PCR (Put-Call Ratio)?
1What is it?
PCR = total put OI ÷ total call OI for an expiry.
2Why does it exist?
Used as a sentiment gauge. Very high PCR is sometimes read as oversold, very low as overbought. These are contrarian, unreliable signals.
3Calculation
PCR = Put OI ÷ Call OI
- Put OI 1.2 crore, call OI 1.0 crore → PCR 1.2.
PCR 1.2.
4Quick revision
- Put OI ÷ call OI.
- Sentiment indicator.
- Not a reliable signal alone.
5Knowledge check
Q1. Put OI 80 lakh, call OI 1 crore. PCR?Show answer
0.8.
Q2. Is PCR a guaranteed signal?Show answer
No.
Q3. PCR uses OI or premium?Show answer
OI (usually).