The Delivery ratio of the market is reported on a daily basis. It is the ratio of the trades that resulted in actual delivery (credit in demat account) to the number of stocks that were closed out intraday (without delivery). This is reported on a daily basis and shows what percentage of the volume in the market is delivery based and what percent is speculative in nature. Typically, market volumes that are squared off during the day are classified as delivery volumes and such delivery volumes can be on the buy side or the sell side. There are a few clear indications that emerge from the Delivery volumes or rather the delivery percentage.

Firstly, a sharp increase in delivery volumes is an indication of a build up of institutional interest in a stock, which is positive. This trend gets ratified if the price is also moving up. On the other hand, higher delivery volumes with price fall is not a good sign as it shows delivery selling. Secondly, the trend in delivery volumes shows which way a particular sector is headed. Typically, we see delivery volumes picking up sharply ahead of a strong rally in stocks as the strong hands start accumulating in the market. Lastly, even on days when the index crashes if the delivery volumes are very high, it is a sign of delivery based selling. This is normally a signal of more downsides in the market to come. Delivery volume ratio is useful at a stock specific level and also at the overall market level.