ODD-LOT DIFFERENTIAL INDEX |
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| Historical data |
Past performance does not guarantee future results!
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| This indicator is calculated
by subtracting the weekly odd-lot sales from the number of weekly odd-lot
purchases. Odd lot transactions are made by small investors who can not
afford to buy or sell short a round lot of 100 shares of a stock. In the
old days this indicator reflected the shorting activity of the smallest
of the small guys who were usually dead wrong at bottoms and tops. Since
the introduction of options however it has lost a lot of its value. Many
traders also sell in 99-share lots in fast markets for a better execution
of their orders. Year-end tax selling and subsequent reinvestment distort
the odd lot statistics as well in the end of December and early in January
every year. But the odd lot numbers are nevertheless an excellent indicator
to measure prevailing negative sentiment in the market. The chart below
shows the weekly Odd-Lot Differential Index on a 4-week moving average.
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Past performance does not guarantee future results!
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