Advance Decline Ratio

Business, Legal & Accounting Glossary

Definition: Advance Decline Ratio

Full Definition of Advance Decline Ratio

The Advance/Decline Ratio is the ratio of the number of advancing issues to declining issues for a given stock exchange such as the NYSE or Nasdaq.

The Advance/Decline Ratio is similar to the Advance/Decline Index in that it displays market breadth.

But, where the Advance/Decline Index calculates the difference between the number of advancing and declining issues, the Advance/Decline Ratio divides the values.

The Ratio, unlike the  Advance/Decline Index, remains constant regardless of the number of issues that are traded on the New York Stock Exchange (which has steadily increased).

Advance/Decline Ratio Calculation

The Advance/Decline Ratio is calculated by dividing the number of advancing issues by the number of declining issues on a specific day or time period.

A moving average of the Advance/Decline Ratio is often used as an overbought/oversold indicator. The higher the value, the more “excessive” the rally and the more likely a correction. Likewise, low readings imply an oversold market and suggest a technical rally.  Day-to-day fluctuations of the Advance/Decline Ratio are often eliminated by smoothing the ratio with a moving average.

Advance/Decline Ratio is an overbought/oversold indicator.

Not all charting sites support advancing and declining issues.

Cite Term

To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
Modern Language Association (MLA):
Advance Decline Ratio. Payroll & Accounting Heaven Ltd. October 21, 2021
Chicago Manual of Style (CMS):
Advance Decline Ratio. Payroll & Accounting Heaven Ltd. (accessed: October 21, 2021).
American Psychological Association (APA):
Advance Decline Ratio. Retrieved October 21, 2021, from website:

Definition Sources

Definitions for Advance Decline Ratio are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 23rd March, 2020 | 3 Views.