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DEFINITION of 'Arms Index - TRIN'

A technical analysis indicator that compares advancing and declining stock issues and trading volume as an indicator of overall market sentiment. The Arms Index, or TRIN (Traders Index), is used as a predictor of future price movements in the market primarily on an intraday basis.


The Arms index is calculated as follows:

TRIN = (advancing issues/declining issues)(volume of advancing issues/
volume of declining issues)

INVESTOPEDIA EXPLAINS 'Arms Index - TRIN'

An Arms Index value above one is bearish, a value below one is bullish and a value of one indicates a balanced market. Traders look not only at the value of the index, but also at how it changes throughout the day. Traders look for extremes in the index value for signs that the market may soon change directions. The Arm's Index was invented by Richard W. Arms, Jr. in 1967.

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