Ulcer Index

Ulcer Index (UI) is a technical analysis indicator developed by Peter G. Martin and Byron B. McCann.  The Ulcer Index is used to measure the riskiness of investments such as securities, commodities, indexes or mutual funds. 

Ulcer Index (UI)

Ulcer Index (UI) is a technical analysis indicator developed by Peter G. Martin and Byron B. McCann.  The Ulcer Index is used to measure the riskiness of investments such as securities, commodities, indexes or mutual funds. 

 


Ulcer Index Formula

The index is based on a given past period of N days. Working from oldest to newest a highest price (highest closing price) seen so-far is maintained, and any close below that is a retracement, expressed as a percentage.

Ulcer Index Formula



Ulcer Index Intrepretation

The Ulcer Index is created by factoring in the depth and duration of drawdowns from recent peaks. A large UI value indicates that the security represents undue risk and an investor who holds it will likely need to wait longer for the investment's price to climb back to its recent highs.

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