Honestly, a friend asked me how to use the long-short ratio, so I’ll use $AGT as an example:
The overall account long-short ratio is 0.49, meaning 33.1% of accounts are long and 66.9% are short.
A ratio above 1 means there are more long positions; below 1 means the proportion of short positions is higher. But most importantly, the more one-sided the ratio, the more cautious you should be about a move in the opposite direction.
The overall account long-short ratio is 0.49, meaning 33.1% of accounts are long and 66.9% are short.
A ratio above 1 means there are more long positions; below 1 means the proportion of short positions is higher. But most importantly, the more one-sided the ratio, the more cautious you should be about a move in the opposite direction.