Abbreviation: Put/Call OpenInt Ratio VolWgtAvg
Category: Option Put / Call
Input Parameters:
| Name | Range | Default |
| Put Open Interest | ||
| Call Open Interest | ||
| Volume | Volume | |
| VolWgtAvg Periods | Int >= 1 | 5 |
Calculation:
VolWgtAvg(X, Volume, VolWgtAvg Periods)
where
X = Put/Call OpenInt Ratio(Put Open Interest, Call Open Interest)
Put/Call OpenInt Ratio represents Put/Call Open Interest Ratio
VolWgtAvg represents Volume Weighted Moving Average
Discussion:
This indicator attempts to smooth the Put/Call Open Interest Ratio indicator by calculating its moving average. Since it uses a volume weighted moving average (which gives more importance to those periods with higher volume relative to the other periods in the moving average’s time frame), the smoothing is influenced more by periods of relatively higher volume than by periods of relatively lower volume.