Speculation Index

DEFINITION of 'Speculation Index'

An index that is derived from the ratio of trading volumes on the American Stock Exchange (AMEX) to volumes on the New York Stock Exchange (NYSE). The speculation index rationale is that since most stocks traded on the American Stock Exchange are speculative, while stocks traded on the NYSE are larger and more established, a higher ratio indicates an increasing degree of speculation, while a lower ratio indicates a decreasing amount of speculation.

BREAKING DOWN 'Speculation Index'

In 2008, the American Stock Exchange was acquired by the NYSE Euronext, which announced that the exchange would be renamed the NYSE Alternext US. The latter was renamed NYSE Amex Equities in March 2009. These changes have made stand-alone American Stock Exchange trading volumes difficult to source and track, as a result of which the speculation index has lost much of its relevance as a measure of speculative activity.

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RELATED FAQS
  1. What are the differences between AMEX and Nasdaq?

    While similar in purpose, the American Stock Exchange (AMEX) and the National Association of Securities Dealers Automated ... Read Answer >>
  2. Do speculators have a destabilizing effect on the financial system?

    A speculator is anyone who trades derivatives, commodities, bonds, equities or currencies with higher-than-average risk in ... Read Answer >>
  3. Why is the Nasdaq more volatile than the NYSE?

    Learn about the stocks that are traded on the Nasdaq stock exchange, and discover the Nasdaq's relative volatility level ... Read Answer >>
  4. How can derivatives be used for speculation?

    Find out more about derivative securities, speculation and how derivatives could be used to speculate on the price of the ... Read Answer >>
  5. How do I invest in the Nasdaq or the NYSE? Is it even possible? Would I want to? ...

    The Nasdaq and the NYSE are stock exchanges that trade securities. Nasdaq stands for National Association of Securities Dealers ... Read Answer >>
  6. What is the difference between speculation and hedging?

    Learn about speculation and hedging, the difference between them, and how traders and investors speculate and hedge. Read Answer >>
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