Arms Index (TRIN): Understanding Market Breadth & Technical Analysis
The Arms Index (TRIN) is a type of market indicator used by technical analysts. This indicator is used to gauge the breadth of the overall market. It can be used for short time periods or long time periods effectively. It is referred to as the Arms index because it was created by Richard Arms.
The Arms Index (TRIN)
In order to calculate this index, you have to follow a basic formula. You take the advancing issues in the market and divide that number by the declining issues in the market. The resulting figure will be the numerator of the final equation. For the denominator, you take the volume of advancing issues and divide that by the volume of decreasing issues. Then take the top number and divide it by the bottom number.
What It Means
Simply calculating this number will not tell you much. You need to understand how to use it to your advantage. If the number equals 1, this means that the market is perfectly in balance. If the number is greater than 1, this means that the majority of the volume in the market is going into stocks that are decreasing in value. A number less than 1 means that the volume is moving upward.
-
Understanding Indexing: A Passive Investment Strategy
Indexing is a passive investment strategy where you construct a portfolioInvestment PortfolioAn investment portfolio is a set of financial assets owned by an investor that may include bonds, stocks, c
-
KOSPI: Understanding South Korea's Stock Market Index
The Korean Composite Stock Price Index (KOSPI) is a group of indexes that track the stock exchange in South Korea. It was previously named the Korea Stock Exchange. Just as the NASDAQ Composite Index
invest
- Understanding Stock Market Indexes: A Beginner's Guide
- TRIN: Understanding the Arms Index for Market Sentiment
- Arms Index (TRIN): Understanding Short-Term Market Sentiment
- Capitalization-Weighted Index (CWI): Explained
- Understanding the EMBI: A Guide to Emerging Market Bond Performance
- NIFTY 50 Index: Understanding India's Top 50 Stocks | NSE
- Russell 2000 Index: Definition, Performance & Investing
- Understanding the S&P 500: A Comprehensive Guide
- MSCI EAFE Index: Performance & Investment Insights
-
EAFE Index: Understanding Developed Market PerformanceThe EAFE Index (Europe, Australasia, and the Far East) was created to measure the performance of the stock markets in developed markets – excluding the U.S. and Canada. The indicator is maintain...
-
Equal-Weighted Index Explained: Benefits & How It WorksAn equal-weighted index is a stock market index – comprised of a group of publicly traded companiesPrivate vs Public CompanyThe main difference between a private vs public company is that the sh...