Spectrum Markets, the pan-European trading venue for securitised derivatives, saw European retail investor sentiment towards oil jump at the start of this week as investors positioned themselves positively ahead of yesterday afternoon’s OPEC+ announcement.
Spectrum’s SERIX indicator of European retail investor sentiment (see below for more information on methodology) rose to 118 for WTI and 102 for Brent on Monday. This compares to an average SERIX value for both underlyings of 98 over the last 12 months.
Sentiment turned bearish again on the day of the announcement itself, dropping to 84 for WTI and 92 for Brent, suggesting many investors took profits or sought to capitalise on any short-term downward price movements.
39.3% (Brent) and 36.3% (WTI) of the trades placed yesterday on products linked to these two underlying markets happened outside of traditional European market hours (i.e. between 17:30 and 9:00 CET), as investors took advantage of Spectrum’s 24-hour trading to respond to the news throughout the night.
Calculating SERIX data
The Spectrum European Retail Investor Index (SERIX), uses the exchange’s pan-European trading data to shed light on investor sentiment towards current development in financial markets.
The index is calculated by subtracting the proportion of bearish trades from the proportion of bullish trades, to give a single figure (rebased at 100) that indicates the strength and direction of sentiment:
SERIX = (% bullish trades - % bearish trades) + 100
Trades where long instruments are bought and trades where short instruments are sold by retail investors are both considered bullish trades, while trades where long instruments are sold and trades where short instruments are bought by retail investors are considered bearish trades. Trades that are matched by retail clients are disregarded(For a detailed methodology and examples, please visit this link).
