I find it endlessly fascinating how certain trading concepts are periodically introduced and recycled through the blog-o-sphere, spreading from one site to the next. The Urban Dictionary already has a word for it — a bleme. Think memes for blogs! It occurs to me that the current quantitative blogger bleme du jour is “inter-market.” We talk around it and consider it in our analyses all the time, but it does sound rather sexy all by its lonesome, doesn’t it!?
Not one to be left out of the fun, I have been wanting to include a simple “heat map” within the Mrkt_Models tool set for some time. As featured below, this one covers a variety of asset classes and maybe useful to day traders in assesing the day’s hot and cold sectors. Distinguishing itself from other such heat-map-type tools, this list auto sorts itself with the biggest movers from the open floating to the top. In addition, you can also see where price lies for any given sector/class versus its daily range, providing a rapid yet broad overview of intra-day inter-market trends from both a vertical and horizontal perspective.
Lastly, the tool makes a judgment about the market’s risk appetite for equities in the current “Risk On”/ “Risk Off” parlance according to the nature of the top ranked securities. The permanent link for this tool will be under our “Mrkt_Models” menu here.
If you find this tool useful, you may also want to explore our Mrkt_End-of-Day tool, which makes continuous end-of-day SPY predictions based on a regression formula utilizing an amalgamation of true inter-market spreads. And don’t take my verbose, late-night, left-field introduction wrong my blemistic friends, this is a very ripe area for more thorough research.
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