Calculation of the Absolute Breadth Index (ABI) formula
Financial acronyms
The entire acronym collection of this site is now also available offline with this new app for iPhone and iPad.
Description of the Calculation of the Absolute Breadth Index (ABI) formula
This formula allows the calculation of the Absolute Breadth Index (ABI) for an equity market or a group of shares.
Formula
\[ ABI = \frac{ \vert N_{adv} - N_{dec} \vert } { N_{adv} + N_{dec} } \ \]
Symbols
\(N_{adv}\ \)
Number of advancing shares
\(N_{dec}\ \)
Number of declining shares
Calculation example
Let us consider for example a stock market where 450 shares are listed. In one session, the prices of 290 shares rose and the prices of 160 shares fell.
The ABI would thus result as: |290-160|/450 = 0.29 or 29%.
In another session, 130 shares rose and 320 shares fell. The ABI for that session is: |130-320|/450 = 0.42 or 42%.