Dark Pool Index (DIX)

What is the Dark Pool Index (DIX)?

The Dark Pool Index (DIX) is a daily reading of how much S&P 500 off-exchange volume was marked short, weighted by the dollars traded in each stock. SqueezeMetrics publishes the series, and traders follow it as a gauge of buying that institutions route away from public exchanges.

The logic runs through the market maker. Wholesalers and dark pools fill much of the buying that reaches them by selling short, then cover later. Short-marked volume therefore rises with buying pressure, which is why a higher DIX reads as stronger demand.

How is DIX calculated?

Start with each S&P 500 stock’s off-exchange short-volume ratio: ShortVolume divided by TotalVolume from FINRA’s daily files. Multiply each stock’s short and total shares by its price, add the dollars across the index, and divide short dollars by total dollars.

In the example, the $200 name’s 48.0% and the $50 name’s 40.0% blend to 45.3%, not their 44.0% simple average, because the $200 name traded $1.0 billion against $0.5 billion. Dollar weighting is the point: the names that move the index move the reading.

What does a high or low DIX reading mean?

A high reading means market makers absorbed more buying off-exchange that day, relative to the total dollars traded. A low reading means more of the off-exchange flow came from sellers. The level matters less than the change: a DIX climbing above its recent range, while price holds or dips, is the pattern traders read as accumulation.

Read each day in context. Compare it with the trailing weeks, the index’s price action and the size of the dark pool prints behind the move.

DIX versus short interest

Short interest counts open short positions at a reporting date. DIX counts one session’s short-marked volume, much of it market makers filling customer buys and covering within the day. Use short interest to see how many shares are held short, and DIX to see how much buying the session absorbed.

How traders use DIX with gamma exposure

DIX tells you whether buying is building; gamma exposure tells you where dealer hedging supports or caps the move. Traders look for DIX rising into positive gamma near support, where dealer hedging dampens declines and new buying has room to lift price. A high DIX into negative gamma calls for wider stops, because dealer hedging there adds to every move.

Use the reading to frame the index, then plan the trade: locate the active contracts in options flow and price the position in the options profit calculator.

Limitations of the Dark Pool Index

• Read the trend, not one print. A single day’s DIX moves with the session’s mix of names; the change from its recent range carries the signal.
• Confirm buying with price. A rising DIX that meets a falling index calls for patience until price turns with it.
• Keep the coverage fixed. DIX blends off-exchange volume only, so compare it with its own history rather than with exchange-wide volume measures.
• Read short interest for positioning. DIX counts session transactions, and the market makers behind most short-marked volume cover within the day.

Bottom line

DIX turns FINRA’s off-exchange short-volume data into one dollar-weighted reading of S&P 500 buying. Watch its change against its recent range, and pair it with gamma exposure and price to decide where that buying has room to work.