Investors gauging the direction of financial markets will gain a new tool when State Street launches a new index tracking global investor confidence this week. While there are already indices tracking consumer and business confidence, few measure investor sentiment and risk appetite, State Street said at a pre-launch briefing in Hong Kong yesterday. The new index, which analyses actual and changing levels of risk in investment portfolios, also fills a gap in that it is the first to identify investor behaviour through their actions, rather than through a survey, said Stanley Shelton, the senior managing director of State Street Global Markets. 'This is about investors unknowingly expressing their level of confidence in the marketplace. They themselves don't have a broad enough picture of what is going on and everybody is making what is to them a small decision [to put a larger portion into riskier assets], but collectively it is a large expression of confidence,' he said. Its basis is a database comprising about 15 per cent of the world's tradable securities, which is the portion that State Street, as a custodian, holds in its vaults. The index series, which dates back to mid-1998, pointed to events such as the Asian crisis, the collapse of Long Term Capital Management and the Russian default as well as the more recent corporate governance issues in the US, he said. It hit a record high of 105.4 in July, according to State Street. Since then, it has been trending slightly lower to the latest recorded reading of 103.4 in September. The index will be officially released today, when the October number will be revealed. It will then be published on the second to last Tuesday every month. It would be available to the general public free of charge, but the key target groups were global asset managers who held large pools of pension reserves and central banks and other policy-makers.