The put-call ratio

The put-call ratio represents the perception of investors jointly towards the future. If there is no obvious trend, that is, we expect a normal future, then the put-call ratio should be close to one. On the other hand, if we expect a much brighter future, the ratio should be lower than one. The following code shows a ratio of this type over the years. First, we have to download the data from CBOE. Perform the following steps:

1. Go to http://www.cboe.com/.

2. Click on Quotes & Data on the menu bar.

3. Click on CBOE Volume & Put/Call Ratios.

4. Click on CBOE Total Exchange Volume and Put/Call Ratios (11-01-2006 to present) under Current.

Assume that the file named totalpc.csv is saved under C:\temp\. The code is given as follows:

import pandas as pd
from matplotlib.pyplot import *
data=pd.read_csv('c:/temp/totalpc.csv',skiprows=2,index_col=0,parse_dates=True)
data.columns=('Calls','Puts','Total','Ratio')
x=data.index
y=data.Ratio
y2=ones(len(y))
title('Put-call ratio')
xlabel('Date...