Stock To Flow ratio

Definition

The Stock To Flow (S2F) ratio is a vital indicator provided by Santiment. Defined in the simplest terms, it's a measure of the scarcity or abundance of a specific asset. The stock-to-flow ratio is fundamentally a relationship between the total supply of an asset (the stock) and its production rate (the flow). We measure the stock-to-flow ratio for a given asset as the ratio between the Total Circulation of the asset and the daily minted coins multiplied by days in one year.

The 'stock' aspect relates to the existing supply of the asset in circulation, while the 'flow' portion refers to the newly produced assets, usually measured annually.

Source: https://app.santiment.net/charts/stock-to-flow-ratio-btc-22307

Applying the Stock to Flow Ratio to Trading

In the trading world, how does the stock-to-flow ratio come into play? A high S2F ratio implies scarcity, meaning there's less production compared to the existing supply. This scarcity could signify a potential price increase due to the limited new supply making its way to the market. On the opposite end, a low stock-to-flow ratio indicates a larger new supply but a smaller demand, possibly leading to a depreciation in the asset's value.

Making Informed Trading Decisions with the S2F Ratio

As a trader, a high stock-to-flow ratio could be viewed as a buying signal, as the high scarcity could mean potential price appreciation. However, a low S2F might be a selling cue to prevent potential losses from the predicted oversupply.

However, the stock-to-flow ratio shouldn't be the only tool you use when deciding to buy or sell. It should be used alongside other indicators and market analysis methods. Remember to assess overall market sentiment, global economic trends, and particular news or events that could affect price changes of your chosen asset.

In essence, the stock-to-flow should be one tool in a collection used to formulate a comprehensive and robust trading strategy.

Access

Stock To Flow ratio metric is available only in Custom plans.

Restricted Access.

Timebound

Timebound Metrics available

Measuring Unit

Token/Coin amount

Data Type

Timeseries Data

Frequency

Daily Intervals

Latency

On-Chain Latency

Available Assets

Available for these assets

Note: stock_to_flow metric is available only for assets that mint new coins on a regular basis.

SanAPI

Available under the stock_to_flow name.

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{
  getMetric(metric: "stock_to_flow") {
    timeseriesData(
      slug: "bitcoin"
      from: "2020-01-01T00:00:00Z"
      to: "2020-01-07T00:00:00Z"
      interval: "1d"
    ) {
      datetime
      value
    }
  }
}

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