Fear and Greed Index: How It Works, Tested Since 2021

Fear on Wall Street can be measured, every day and in a single number. CNN’s Fear and Greed Index combines seven market measures into one reading between 0 (extreme fear) and 100 (extreme greed). This guide explains how it is built, what its zones mean and what an extreme reading tells you as a trader.

We also tested the index on CNN’s own data since 2021. When it fell below 20, the S&P 500 was 1.9 percent higher on average 20 trading days later, compared with 1.1 percent across all days. After 60 trading days, the edge had shrunk to 0.2 percentage points.

The Fear and Greed Index in 30 seconds

• Sentiment gauge: CNN’s Fear and Greed Index measures the mood of the US stock market on a scale from 0 (extreme fear) to 100 (extreme greed).
• Calculation: seven equally weighted components, including S&P 500 momentum, the VIX and demand for junk bonds. CNN recalculates as soon as new data becomes available.
• Zones: below 25, CNN speaks of Extreme Fear, above 75 of Extreme Greed.
• Our analysis: after 14 signals below 20 (2021 to 2026), the S&P 500 was 1.9% higher on average 20 trading days later, against 1.1% across all days. After 60 trading days only 0.2 percentage points of difference remained.
• Extreme phases: 2.9 on April 8, 2025 and 5.2 on November 20, 2025. For the Covid crash, CNN reported a low of 2 on March 12, 2020.
• Crypto: Alternative.me publishes an index for Bitcoin, CoinMarketCap one for the ten largest cryptocurrencies.
• Bottom line: a sentiment gauge, not a buy or sell signal.

Fear and Greed Index: November 4, 2026 snapshot

At the US close on November 4, 2026, CNN’s Fear and Greed Index stood at 27, which CNN rates as Fear. One week earlier it was 34, one month earlier 38. On November 2 it had dipped to 19.4, inside the Extreme Fear zone.

This page shows a dated snapshot, not a live value. For the current reading, use the CNN Business page linked in the sources section below. On our German site, the values for US stocks and Bitcoin are refreshed every morning.

What is the Fear and Greed Index?

The Fear and Greed Index is a sentiment indicator from CNN Business that combines seven measures of the US stock market into a single reading between 0 and 100: readings near 0 stand for extreme fear, readings near 100 for extreme greed.

The idea behind it is simple. Investors do not act on numbers alone, they also act on emotion. Too much fear can push stocks below the level that earnings and the economy justify. Too much greed can push them above it.

Warren Buffett put this into a famous line. His advice in his 1986 letter to Berkshire Hathaway shareholders was “to be fearful when others are greedy and to be greedy only when others are fearful.” The index turns the mood of others into a number.

Behavioral finance supplies the vocabulary. It describes typical biases such as herd behavior, loss aversion and overconfidence. The index shows when such patterns dominate the market. You can read more in our Warren Buffett portrait and in our guide to risk management.

How to read the five zones

CNN assigns every reading to one of five zones. In CNN’s data the boundaries are at 25, 45, 55 and 75. Readings are usually shown rounded, so the zone always comes from the provider itself; Alternative.me rates its Bitcoin index separately.

Reading	CNN zone	What it means
below 25	Extreme Fear	Heavy selling pressure, many investors hedge
25 to below 45	Fear	Cautious mood, investors hold back
45 to 55	Neutral	No clear direction in sentiment
above 55 to 75	Greed	Risk appetite is rising
above 75	Extreme Greed	Very high risk appetite, many investors are fully invested

The zones are orientation, not a trading signal. A reading in Extreme Fear does not mean the market turns the next day. From late February to late March 2025 the index stayed in that zone for 19 trading days, and the S&P 500 stood 13.4 percent lower 20 trading days after the phase ended than at its start.

How the Fear and Greed Index is calculated: the seven indicators

The index is built from seven components that CNN weights equally. According to CNN’s methodology page, it tracks how far each one deviates from its average, compared with how far it normally diverges. Each component gets a score from 0 to 100, and the index is their mean. CNN does not publish the exact formula, so the index cannot be recalculated from outside.

Market momentum: the S&P 500 against its average

The first component compares the market with its recent past. CNN sets the S&P 500 against its average of the prior 125 trading days. Above it counts as greed, below it as fear. Our S&P 500 forecast covers the current picture.

Stock price strength: new highs against new lows

A few large stocks can distort an index. That is why CNN counts the stocks on the New York Stock Exchange at new 52-week highs and those at new 52-week lows. Many more highs signal greed, many more lows signal fear.

Stock price breadth: market breadth

Breadth shows whether a rally rests on many shoulders. The basis is the McClellan Volume Summation Index, which compares the volume of rising and falling stocks on the NYSE. A low or negative reading counts as fear. CNN’s page points to a minor calculation change in this component.

Put/call ratio: hedging in the options market

Options reveal how much investors are hedging. CNN uses the 5-day average of the ratio of puts to calls. A rising ratio means growing nervousness, and CNN considers a ratio above 1 bearish.

Market volatility: the VIX against its 50-day average

The best-known fear gauge is the VIX. It measures the expected volatility of the S&P 500 over the next 30 days, derived from option prices. CNN compares it with its 50-day moving average: a VIX above it counts as fear. The bond market has its own gauge, the MOVE index.

Safe haven demand: bonds against stocks

In uncertain times, money flows into safe havens. CNN measures the difference between the returns of Treasury bonds and stocks over the past 20 trading days. When bonds do better, it counts as fear.

Junk bond demand: high yield against safer bonds

The last component measures risk appetite in the bond market. It compares the yields of junk bonds with those of safer bonds. A narrow spread shows investors accept more risk for little extra return, which counts as greed. CNN points out that the spread in its chart often drops briefly on ex-dividend dates.

Sentiment is only one side of the picture. What the market expects from the Fed is shown by the CME FedWatch Tool. Together they combine mood and rate expectations.

Extreme fear since 2020: the phases and what came next

Since 2021, CNN’s index has fallen below 6 in four separate fear phases. The lowest readings were 3.2 on May 12, 2022, 2.9 on April 8, 2025 after the US tariff announcements, 5.2 on November 20, 2025 and 5.8 on March 30, 2026. In October and early November 2026 the index slipped back into Extreme Fear, with a low of 16.7 on October 23.

The publicly available CNN data series begins in July 2020, so it no longer covers the Covid crash. In June 2020, CNN Business reported that the index had hit a low of 2 on March 12, 2020. On that day the Dow Jones lost almost ten percent.

Our analysis of CNN’s data identified 18 phases since 2021 with at least three trading days of extreme fear. The table shows the eight longer ones, with at least ten such days. Breaks of up to two days count as the same phase. The last column shows where the S&P 500 stood 20 trading days after the phase ended, measured from the start of the phase.

Phase (days of extreme fear)	Low	S&P 500, 20 days after the phase
Sep to Oct 2021 (19 days)	9.5 on Oct 4, 2021	+4.2%
Feb to Mar 2022 (13 days)	16.7 on Mar 8, 2022	+4.1%
Apr to May 2022 (22 days)	3.2 on May 12, 2022	−6.6%
Sep to Oct 2022 (16 days)	13.3 on Sep 29, 2022	+5.3%
Feb to Mar 2025 (19 days)	11.0 on Mar 4, 2025	−13.4%
Mar to Apr 2025 (18 days)	2.9 on Apr 8, 2025	+4.1%
Nov to Dec 2025 (14 days)	5.2 on Nov 20, 2025	+1.8%
Mar to Apr 2026 (20 days)	5.8 on Mar 30, 2026	+6.8%

In six of eight phases, the S&P 500 was higher afterwards than at the start. The two exceptions show the risk: in spring 2022 and spring 2025 the sell-off continued after the first fear phase.

Our analysis: the S&P 500 after readings below 20

We fixed the rules before running the numbers. A signal is the first day the CNN reading falls below 20 after being at least 20 on the previous trading day. Because the value is only final after the US close, we measure from the next day’s close. We track the S&P 500 without dividends or costs after 5, 20 and 60 trading days. While one measurement is running, no new signal counts.

The data are CNN’s daily readings from January 4, 2021 to November 3, 2026. CNN delivers the S&P 500 closing prices in the same file. We checked them against Yahoo Finance: of 1,585 trading days, only one differed by more than 0.05 percent. CNN’s value is missing for March 12, 2026; there we use the Yahoo Finance close. The comparison is with all trading days in the same period.

Horizon	After a signal (count)	All days
5 trading days	+1.1% (19)	+0.3%
20 trading days	+1.9% (14)	+1.1%
60 trading days	+3.4% (9)	+3.2%

In the short run, buying after extreme fear came out ahead; after 60 trading days the advantage was much smaller. After 20 trading days, 11 of 14 signals were in profit, against 66 percent of all days. After 60 trading days the picture reversed: 6 of 9 signals in profit, against 75 percent of all days, and the average edge shrank to 0.2 percentage points. With so few signals, the edge may be chance; it is not robust.

The road to the result was rarely comfortable. After the signal on April 1, 2025, the S&P 500 fell as much as 12.1 percent (on a closing basis) below the entry price within 20 trading days. Anyone who buys on the index needs a stop or a lot of patience. Our guide to position sizing shows how to keep that risk small.

How traders use the Fear and Greed Index

Three uses are common. None of them is a complete system, and how much they help depends on the time horizon, as our analysis above shows.

Contrarian trading: against the crowd

Contrarians use extreme readings as a counter-signal. They look for buying opportunities in extreme fear and grow cautious in extreme greed. Trading blindly against the crowd is still not a recipe; the timing remains hard.

A cross-check for your own analysis

The index works best as a second opinion. If your technical analysis gives a buy signal while the index shows deep fear, you are buying against the mood. If it shows extreme greed, take a second look at your stop and position size, even when the chart looks good.

Extra buys for long-term investors

Investors who buy ETFs regularly can use the index for extra purchases. In phases of extreme fear they add a one-off amount to their savings plan. Our analysis showed no robust edge for that: after 60 trading days, the S&P 500 was only 0.2 percentage points ahead of the average after readings below 20, with fewer positive cases.

Crypto Fear and Greed Index: Bitcoin and altcoins

Cryptocurrencies have their own fear and greed indices. They use different data than CNN; the two best known come from Alternative.me and CoinMarketCap.

According to its methodology, the Alternative.me index covers Bitcoin only. It weights volatility at 25 percent, momentum and volume at 25 percent, social media at 15 percent, and Bitcoin dominance and Google Trends at 10 percent each. Surveys, worth 15 percent, are paused according to the provider; the page does not explain how that share is currently distributed.

CoinMarketCap takes a broader view. Among other inputs, its index looks at the price performance of the ten largest cryptocurrencies, excluding stablecoins, plus the implied volatility of Bitcoin and Ethereum and their put/call ratio. For the current Bitcoin chart picture, see our Bitcoin forecast.

Where to check the Fear and Greed Index

CNN’s index is recalculated continuously. According to CNN, every component and the index are updated as soon as new market data becomes available. Alternative.me resets its Bitcoin value once a day, so the two indices are not updated on the same schedule.

Source	Market	What you get
CNN Business	US stocks	The original reading, all seven components and the history
Alternative.me	Bitcoin	Daily values since February 2018 and an open API
CoinMarketCap	Top 10 cryptocurrencies	Its own index with a history chart

It is normal for the readings to differ. CNN and Alternative.me measure different markets with different inputs. Stocks and Bitcoin can be in completely different moods at the same time, and these gaps are often more telling than any single reading.

The fear and greed apps Google shows in search come from third parties. They are not run by CNN. For a daily look, the provider’s website is enough.

Strengths and limits of the Fear and Greed Index

What the index does well

• Simplicity: one number combines seven market measures and is easy to read.
• Free access: CNN publishes the index and its components free of charge and updates them continuously.
• Excesses made visible: extreme readings show when sentiment tips. In our analysis the S&P 500 was ahead on average 20 trading days after readings below 20.
• Broad data base: stocks, options, bonds and volatility all feed in.

Where it reaches its limits

• No timing tool: the index shows sentiment, not the turning point. Since 2021, phases of extreme fear lasted up to 22 trading days.
• Little long-term edge: after 60 trading days, the S&P 500 was only 0.2 percentage points ahead after signals, with fewer positive cases. With nine cases that is no proof either way.
• US only: European and Asian markets are not covered.
• No valuation: it measures mood, not the value of companies. High greed does not automatically mean overvaluation.
• Formula not public: CNN describes the building blocks, but not the exact calculation.

Conclusion: a good sentiment gauge, but not a buy signal

The Fear and Greed Index shows in one number how much fear or greed is driving the US stock market. It is useful because it bundles seven market measures and updates continuously. On its own it is not a buy signal.

Our analysis argues for patience rather than reflex. After readings below 20, the S&P 500 was ahead on average 20 trading days later, but barely after 60 trading days. In between there were sharp setbacks, in April 2025 up to 12 percent below the entry price.

The index is most useful as a cross-check on your own analysis. Combined with your chart analysis and an honest look at your own psychology, it helps you notice when you are simply running with the crowd. This is market analysis, not investment advice.

Frequently asked questions about the Fear and Greed Index

Where can I find the current Fear and Greed Index?

CNN Business publishes the current reading free of charge at edition.cnn.com/markets/fear-and-greed. According to CNN, the index and its components are recalculated as soon as new data becomes available. Our German site shows the value every morning next to the Bitcoin index from Alternative.me.

How is the Fear and Greed Index calculated?

The index consists of seven equally weighted components. They are market momentum (S&P 500 against its 125-day average), stock price strength, stock price breadth, the put/call ratio, the VIX, safe haven demand and junk bond demand. Each produces a score from 0 to 100, and the index is their average.

What is a good Fear and Greed Index reading?

There is no good reading, only extreme ones. Below 25, CNN speaks of extreme fear, above 75 of extreme greed. Contrarian traders watch those extremes most closely, but on their own they are not a signal.

When should you buy according to the Fear and Greed Index?

The index does not give a fixed buying point. In our analysis from 2021 to 2026, the S&P 500 was 1.9 percent higher on average 20 trading days after a reading below 20, compared with 1.1 percent on ordinary days. After 60 trading days the edge was only 0.2 percentage points.

Is there a crypto Fear and Greed Index?

Yes, Alternative.me publishes an index for Bitcoin and CoinMarketCap one for the ten largest cryptocurrencies. Both use different data than CNN, such as volatility, trading volume and social media.

How reliable is the Fear and Greed Index?

As a gauge of sentiment yes, as a forecast no. The index reliably shows when panic or euphoria dominates. It does not show the bottom: from late February to late March 2025 it stayed in extreme fear for 19 trading days before the next sell-off came in April.