Arms Index
Developed by Richard W. Arms, Jr. A technical analysis indicator that reveals the ratio of the rising or declining stocks and their corresponding volume.
It’s calculated as the quotient of the rising stocks divided by the number of declining stocks to determine the Advance/Decline Ratio. Then, the Upside/Downside Ratio is calculated as the quotient of the volume of the rising stocks by the volume of the declining stocks.
The final step is to divide the Advance/Decline Ratio by the Upside/Downside Ratio. The Arms Index is considered bullish when below 1.0 and bearish above 1.0. Also known as TRIN or MKDS.