Which of the following statements about the put/call ratio is most accurate?
A) A negative ratio is bullish.
B) Investors interpret a ratio greater than 1 to be a bearish indicator.
C) Investors interpret a relatively low ratio to be a bearish indicator.
D) Investors interpret a relatively high ratio to be a bearish indicator.

Question

Quizplus · Accepted Answer

Investors interpret a relatively high ratio to be a bearish indicator because it suggests that there is more demand for puts (options to sell) than calls (options to buy), indicating that investors are expecting the underlying asset to decline in value.

Which of the Following Statements About the Put/call Ratio Is