Starting today, Boerse Stuttgart, Europe’s leading exchange for leverage and investment products, offers investors the Euwax Sentiment index, which tracks private investor behaviour according to scientifically supported data. The Euwax Sentiment index is based on near-market orders placed by retail investors for warrants and knockout products on the DAX. This focus on DAX-linked leverage products ensures a particularly strong correlation with the overall market. Boerse Stuttgart publishes the index on its website at www.boerse-stuttgart.de/euwax-sentiment.
Christoph Lammersdorf, Managing Director and CEO of Boerse Stuttgart Holding GmbH comments on the new product: “Boerse Stuttgart is the market leader in leverage products, accounting for more than two thirds of the exchange-traded volume, so it is ideally suited to track the overall sentiment of retail investors. Thus, private investors obtain a key orientation tool for their trading decisions.”
Boerse Stuttgart’s new index concept is based on a long-time scientific partnership with Karlsruhe Institute of Technology, under the direction of Professor Christof Weinhardt, Head of the Institute of Information Management and Systems. “Only near-market orders are included in the calculation of the private investor index. This ensures that the index in fact reflects the most up-to-date market evaluations of private investors”, explains Christof Weinhardt. Excluded from the index, for example, are orders that have been awaiting execution for some time, and which therefore represent market evaluations that are no longer current.
The private investor index is calculated continuously, based on the volume of orders executed for retail customers. This provides a highly accurate picture of private investor sentiment, since it is not subject to distortion by individual, large-scale customer transactions. Purchases of long products and sales of short products indicate positive sentiment, while purchases of short products and sales of long products suggest a negative mood. The ratio between executed orders in the two respective categories determines the sentiment score.