The put/call ratio is a helpful indicator for what options traders’ currently think about a stock’s outlook. Since put options represent the prediction that a stock price will fall, and call options are the opposite position, increases in put/call are bearish while decreases are bullish.
We ran a screen on US-traded companies based out of China for those with bullish sentiment from options traders, with significant decreases in put/call over the last ten trading days.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.
We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.
Click to enlarge
Do you think options traders are calling it right? Use this list as a starting-off point for your own analysis.
List sorted by decrease in put/call.
1. TAL Education Group (XRS): Provides K-12 after-school tutoring services in the People's Republic of China. Market cap of $763.0M. Put/call ratio decreased from 14.12 to 0.25 between 10/28 and 11/10, a decrease of 98.23%. The stock has lost 41.62% over the last year.
2. China Green Agriculture, Inc. (CGA): Engages in the research, development, manufacture, distribution, and sale of humic acid based compound fertilizers in China. Market cap of $113.15M. Put/call ratio decreased from 0.85 to 0.29 between 10/28 and 11/10, a decrease of 65.88%. The stock is a short squeeze candidate, with a short float at 10.57% (equivalent to 12.57 days of average volume). The stock has had a couple of great days, gaining 5.53% over the last week. The stock has performed poorly over the last month, losing 15.66%.
3. Fushi Copperweld, Inc. (FSIN): Develops, designs, manufactures, markets, and distributes bimetallic wire products, principally copper-clad aluminum (CCA) and copper-clad steel (CCS). Market cap of $267.02M. Put/call ratio decreased from 0.12 to 0.05 between 10/28 and 11/10, a decrease of 58.33%. Might be undervalued at current levels, with a PEG ratio at 0.83, and P/FCF ratio at 4.65. The stock is a short squeeze candidate, with a short float at 33.54% (equivalent to 28.3 days of average volume). The stock has had a good month, gaining 16.5%.
4. Yongye International, Inc. (YONG): Engages in the research, development, manufacture, and sale of fulvic acid based liquid and powder nutrient compounds for plants and animals, which are used in the agriculture industry in the People's Republic of China. Market cap of $273.02M. Put/call ratio decreased from 0.45 to 0.26 between 10/28 and 11/10, a decrease of 42.22%. The stock is a short squeeze candidate, with a short float at 9.37% (equivalent to 10.09 days of average volume). The stock has had a couple of great days, gaining 10.6% over the last week.
*Options data sourced from Schaeffer’s, all other data sourced from Finviz.