Quantopian's community platform is shutting down. Please read this post for more information and download your code.
Back to Community
Trading with the CNN Fear & Greed Index (Updated)
Gus Gordon
posted Aug 4, 2015
Using Data Show Q

CNN has a Fear and Greed Index for the market. This Index supposedly shows how fearful or greedy investors are at the time. The F&G Index ranges from 0-100, 0 being the most fearful and 100 being the most greedy. If investors are greedy stock prices should rise; if they are fearful stock prices should fall. So, if someone traded base off only this Index for five years, how would they do? This algorithm goes long when the Index is above 50, and goes short when the Index is below 50. That threshold value can be changed in the algorithm.

This has more data than my original version, and is slightly modified. This version of the strategy runs in minute-mode and trades at the start of every day using the previous day's Index. You can see that the strategy somewhat follows the market, and does not do very well, indicating that the F&G Index isn't a great indicator.

Play around with the strategy by cloning it below and let me know what you think. There may be better ways to trade with the F&G Index than this simple one.

Disclaimer

The material on this website is provided for informational purposes only and does not constitute an offer to sell, a solicitation to buy, or a recommendation or endorsement for any security or strategy, nor does it constitute an offer to provide investment advisory services by Quantopian. In addition, the material offers no opinion with respect to the suitability of any security or specific investment. No information contained herein should be regarded as a suggestion to engage in or refrain from any investment-related course of action as none of Quantopian nor any of its affiliates is undertaking to provide investment advice, act as an adviser to any plan or entity subject to the Employee Retirement Income Security Act of 1974, as amended, individual retirement account or individual retirement annuity, or give advice in a fiduciary capacity with respect to the materials presented herein. If you are an individual retirement or other investor, contact your financial advisor or other fiduciary unrelated to Quantopian about whether any given investment idea, strategy, product or service described herein may be appropriate for your circumstances. All investments involve risk, including loss of principal. Quantopian makes no guarantees as to the accuracy or completeness of the views expressed in the website. The views are subject to change, and may have become unreliable for various reasons, including changes in market conditions or economic circumstances.

1 response
Gus Gordon
Aug 4, 2015

Also of interest may be Andrew's post on recreating the Index.

About Quantopian
Careers
Community
Events
Documentation
Academia
Lectures
Status
Facebook
Twitter
LinkedIn
YouTube
Terms of Use
Privacy Policy

The material on this website is provided for informational purposes only and does not constitute an offer to sell, a solicitation to buy, or a recommendation or endorsement for any security or strategy, nor does it constitute an offer to provide investment advisory services by Quantopian.

In addition, the material offers no opinion with respect to the suitability of any security or specific investment. No information contained herein should be regarded as a suggestion to engage in or refrain from any investment-related course of action as none of Quantopian nor any of its affiliates is undertaking to provide investment advice, act as an adviser to any plan or entity subject to the Employee Retirement Income Security Act of 1974, as amended, individual retirement account or individual retirement annuity, or give advice in a fiduciary capacity with respect to the materials presented herein. If you are an individual retirement or other investor, contact your financial advisor or other fiduciary unrelated to Quantopian about whether any given investment idea, strategy, product or service described herein may be appropriate for your circumstances. All investments involve risk, including loss of principal. Quantopian makes no guarantees as to the accuracy or completeness of the views expressed in the website. The views are subject to change, and may have become unreliable for various reasons, including changes in market conditions or economic circumstances.