Survey Rules for Sentiment Indicators

Investors' opinion of the market

The sentiment indicators are based on the assessments of institutional and private investors. They are surveyed once a week by Deutsche Börse AG and asked whether the respective index - the Dax or the TecDAX - will rise, fall or move sideways in the following 30 days.

Regular surveys

Around 150 institutional investors take part in each of the surveys. These are fund managers, asset managers, or floor traders. In addition, the opinions of around 150 private investors are collected for the technology stocks mood barometer.

Active market participants

The outstanding feature of these sentiment indicators is that only active investors, who are involved in the market, participate in the surveys. Unlike analysts, active market participants have both a psychological as well as a material bond (commitment) to their investments: Their assessments usually mirror their positions. Someone who has bought shares will hardly give a negative forecast about his own papers. Likewise, anyone who has reduced his inventories will not give an optimistic opinion.

Unchanged participation

One of the key prerequisites for stable results is to ask the same investors every week, if at all possible. Therefore, the responses of at least 80 percent of the participating institutional investors must be included in every single survey. If this requirement is not fulfilled on any occasion, the sentiment index would only be published with the proviso that the results are not totally accurate; publication might even be suspended. The results of each survey are made anonymous and transmitted to Cognitrend, a company that carries out behavior-oriented capital market analyses, which evaluates the data. The votes of the market participants all carry the same weight, irrespective of their level of investment. Deutsche Börse regularly examines the quality of the data and ensures that data is received continuously.

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