ISE Sentiment Index (ISEE)

By International Securities Exchange

The ISE Sentiment Index (ISEE) is designed to show how investors view stock prices. The ISEE only measures opening long customer transactions on ISE. Transactions made by market makers and firms are not included in ISEE because they are not considered representative of market sentiment due to the often specialized nature of those transactions. Customer transactions, meanwhile, are often thought to best represent market sentiment because customers, which include individual investors, often buy call and put options to express their sentiment toward a particular stock.

Therefore ISE Sentiment Index is a contrarian indicator. When it reaches "excessive" levels, the market usually corrects by moving the opposite direction.