An assessment of how bearish or bullish specialists are on a security, measured by a ratio of short sales made by specialists on a security to the total short sales on a given trading day. Specialists are thought to be especially knowledgeable about the direction of the market, and most investors generally sell short when they are feeling bearish. Thus, a high short sale ratio is considered to be a bearish signal, while a low ratio is thought to be bullish.
The view of specialists as to the future direction of a stock or of the stock market itself. Some investors, believing specialists have an inside, or a particularly informed, view of the market, try to make their own investment decisions based on their perceived interpretation of specialists' sentiment, in hopes of gaining above-average profits. Specialists' sentiment is sometimes measured by studying the specialists' short sales.