Get A Pulse Of The Market - The Fear Greed Index

“Be fearful when others are greedy and be greedy when others are fearful.”

Warren Buffet's famous paraphrase is probably one of the best pieces of investing advice out there, except that it is so hard to know what others are feeling.

You could try and use tweets to measure sentiment, or you could take a poll at the neighbourhood barbershop. Here's an easier alternative - the fear greed index, which is an amalgamation of a few factors like the VIX, Junk Bond demand, market breadth etc.

It is a contrarian indicator and you want to buy when there's extreme fear and be cautious when we're in extreme greed territory.

1 year ago, we were living in extreme fear. Capital deployed then would have earned you very nice returns.

You can check out the indicator here: https://money.cnn.com/data/fear-and-greed/