// Licensed under the Apache License, Version 2.0
// © mihakralj
//@version=6
indicator("Theil Index (THEIL)", "THEIL", overlay=false, precision=6)

//@function Calculates Theil's T Index for a series over a lookback period.
//@param src series float Input data series (must be positive values).
//@param len simple int Lookback period (must be > 0).
//@returns series float The Theil's T Index, or na if data is not suitable.
theil_t_index(series float src, simple int len) =>
    if len <= 0
        float(na)
    float sum_src = 0.0
    int n_valid = 0
    float[] values_arr = array.new_float()
    for i = 0 to len - 1
        val = src[i]
        if not na(val) and val > 0
            array.push(values_arr, val)
            sum_src += val
            n_valid += 1
    if n_valid == 0
        float(na)
    float mean_val = sum_src / n_valid
    if mean_val <= 0
        float(na)
    float theil_sum = 0.0
    for i = 0 to n_valid - 1
        xi = array.get(values_arr, i)
        ratio = xi / mean_val
        if ratio > 0
            theil_sum += ratio * math.log(ratio)
    float theil_t = na
    if n_valid > 0
        theil_t := theil_sum / n_valid
    
    theil_t

// Inputs
i_source = input.source(close, title="Source (must be positive values)")
i_length = input.int(14, title="Lookback Period", minval=1)

// Calculation
theil_value = theil_t_index(i_source, i_length)

// Plot
plot(theil_value, "Theil T Index", color=color.yellow, linewidth=2)