A sentiment indicator calculated by dividing put trading volume or open interest by call trading volume or open interest.
The put-call ratio (PCR) compares the volume or open interest of put options to that of call options for a given underlying and expiry. A PCR above 1 suggests relatively higher put activity, often read as bearish or as a sign of hedging demand, while a PCR below 1 suggests relatively higher call activity, often read as bullish. Traders use PCR alongside other indicators as a contrarian or confirming signal of overall market sentiment, rather than as a standalone trading trigger.
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