Put-call ratio of stock options up

Mumbai, Nov 18 | Updated: Nov 19 2005, 06:06am hrs
The put-call ratio of the stock options market on National Stock Exchange (NSE) increased to 0.21 on November (up to 17) from 0.18 in September 2005. This displays a bearish outlook as the volume of both put and call are declining. The put-call ratio indicates whether the market is an overbought or oversold condition. The ratio increased from 0.18 in September to 0.20 in October and increased thereafter to 0.21 in November.

A dealer at a domestic brokerage house said: Sudden dip in the broad market in the last two weeks of October unnerved most speculators. This led to sharp unwinding of open positions in the F&O market. The rally witnessed in the month of November, has failed to convince most speculators and traders, which in line has led to increase the put-call ratio.

The volume of call options have decreased from 68.98 crore in September to 49.34 crore in October, and thereafter reached a lower level of 22.96 crore in November (up to 17). Volume of put options have also decreased from 12.74 crore during September to 10.08 crore during October and further decreased to 4.69 crore in November. During the second half of 2005, the volume of put options reached the highest during the month of September.

Similarly in terms of value, call options showed a steady decline from Rs 12,917 crore during September to Rs 10,753 crore during October and further decreased to Rs 4605.04 crore in November (up to 17th). The value of put options also showed a similar trend. The total value decreased from Rs 3,069 crore in September to Rs 2,822 crore in October and decreased thereafter to Rs 1,249 crore in November.

Top five companies in terms of call options in November (up to 17) are Reliance Industries (Rs 849 crore), SBI (Rs 447 crore), Satyam Computer Services (Rs 284 crore), Reliance Capital (Rs 243 crore) and NTPC (Rs 228crore). Among these, only three firms namely Reliance Inds, Satyam Computer and NTPC were in the list of top five in October.

Similarly in terms of value of put options, the top five were Reliance Industries (Rs 261 crore), Satyam Computer (Rs 237 crore), SBI (Rs 174 crore), Reliance Capital (Rs 49 crore) and Infosys Technologies (Rs 48 crore). Here also only four firms namely Reliance Industries, Satyam Computer, SBI and Infosys Technologies were in the list of top five in the month of October.

From Rs 2,200 crore in September, the call option value of Reliance Industries decreased to Rs 1,764 crore in October and further declined to Rs 849 crore in November (up to 17).