Deutsche Börse is set to release a new 'behaviour-oriented' equity index based on the Neuer Market – made up of 325 mainly German technology and high-growth companies – as a market information tool for dealers.The Neuer Market Sentiment Index is designed to track the level of optimism on the Neuer Market through regular surveys of market participants. Deutsche Börse will ask 140 institutional investors and 160 retail investors their opinion on the Neuer once per week, using the aggregated information to update the Sentiment Index. The Index is still in the testing stage, but should be available on the Deutsche Börse website within the next few days, a spokeswoman for the exchange said.
A spokesman for Swiss-German derivatives exchange Eurex, which is partly owned by Deutsche Börse, said equity options and equity index options traders could use the index as a decision-making aid when setting hedging strategies.
Jason Good, head of equity derivatives sales at Deutsche Bank in London, said he would most likely use the Sentiment Index as a volatility indicator. “If the index shows that there’s a lot of mixed sentiment in the market, then volatilities will probably increase,” said Good
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