What it does
Ratio plots the chart symbol's price divided by a second symbol's price. Unlike the raw spread, division normalizes for scale, making it the standard way to track relative performance between two instruments. A rising ratio means the numerator is outperforming; a falling ratio means the denominator is.
Typeoscillatorseparate pane
How to add it
Click Indicators (ƒx) in the header.
Search “Ratio” and click the result.
Hover its legend row and click the gear to open settings.
How traders use it
- Use it for relative-strength decisions: hold or buy the asset while its ratio versus the benchmark rises, rotate away when it rolls over.
- Apply normal technical analysis to the ratio: trendlines, moving averages and breakouts on the ratio often lead the same events in price.
- In pairs trading, a ratio far above or below its long-run mean (e.g., beyond 2 standard deviations of a Bollinger Band on the ratio) flags a stretch to fade in mean-reverting pairs.
- Classic macro reads come from ratios: stock/index for leadership, gold/silver for metal rotation, sector/market for allocation.
- Confirm ratio turns with the absolute chart of the leg you plan to trade, since a ratio can turn purely from the other leg moving.
Inputs
| Input | Type | Default | Range / Options |
|---|---|---|---|
| Symbol | symbol | — | — |
Plots & styling
| Plot | Style | Default color |
|---|---|---|
| Plot | line | #2196F3 |
Every plot's color, line width and visibility can be changed on the Style tab. Precision (default 4 decimals), price-scale labels and status-line values are configurable at the bottom of the Style tab.
Tips
- Resize the pane by dragging its divider; collapse it from the legend row when you need the space back.
- Use Add to favorites in the legend menu; starred studies surface at the top of the picker.
- Reference levels (where the study has them) are editable — tune them to the instrument you're trading.
- This indicator accepts another symbol — leave it empty to use the chart's own symbol.
Watch out for
- Outperformance is not profit: a rising ratio in a bear market may just mean falling less than the benchmark.
- Ratios of weakly related instruments can trend for years; mean-reversion logic only applies to genuinely cointegrated pairs.