Toraku Index

The toraku index provides a big picture view of the Tokyo Stock Exchange, a market breadth indicator. It compares the number of advancing stocks on the exchange to the number of declining ones.

Advancing stocks are ones that trade above the stock’s previous close price. Declining stocks are the opposite, where stocks are trading below their previous close price.

Dividing the advancing stocks by the declining ones provides a ratio for the toraku index. A positive indicator reflects increased trading—a bull market—while a negative one indicates more selling than buying—a bear market.