Macro Fear Index Trader

This is a template. The default signal aggregates four fear dimensions from Polymarket market probabilities -- remix it with VIX data, credit default swap spreads, or social media sentiment scores. The skill handles all the plumbing (market discovery, fear scoring, regime detection, trade execution, safeguards). Your agent provides the alpha.

Strategy Overview

Markets overreact to fear. When geopolitical tensions spike, crypto crashes, disease outbreaks emerge, and extreme weather hits simultaneously, traders panic-sell across ALL categories -- even markets that have nothing to do with the fear catalyst. This creates oversold opportunities.

This skill builds a custom fear index from Polymarket's own markets:

• Geopolitical fear (weight: 0.35): escalation probability, military action, nuclear risk
• Crypto fear (weight: 0.30): inverse of BTC/ETH bullish market probabilities
• Health fear (weight: 0.20): disease outbreak, case count escalation probabilities
• Weather fear (weight: 0.15): extreme weather event probabilities

When the composite fear index exceeds the PANIC threshold, the skill finds ALL markets below YES_THRESHOLD and buys the most oversold ones -- these have been pushed too low by indiscriminate fear selling.

Signal Logic

Step 1: Scan and Classify

All markets from get_markets(limit=200) are classified into fear categories:

Step 2: Compute Fear Index

Each market's probability is converted to a fear score (0-1), then averaged within its category. The composite fear index is a weighted average:

fear_index = 0.35 * geo_fear + 0.30 * crypto_fear + 0.20 * health_fear + 0.15 * weather_fear

Step 3: Regime Detection and Trading

Conviction Scaling

In PANIC regime:

• Base conviction from distance below YES_THRESHOLD: (threshold - p) / threshold
• Fear multiplier: 1 + min(0.5, (fear_index - FEAR_THRESHOLD) / (1 - FEAR_THRESHOLD))
• More extreme fear = more conviction that it's an overreaction

In COMPLACENCY regime:

• Base conviction from distance above NO_THRESHOLD: (p - threshold) / (1 - threshold)
• Complacency multiplier: 1 + min(0.5, (COMPLACENCY_THRESHOLD - fear_index) / COMPLACENCY_THRESHOLD)

Remix Ideas

• VIX integration: Replace or supplement crypto_fear with real-time VIX levels
• Twitter/X sentiment: Feed social media panic metrics into the geo or health fear scores
• Credit spreads: Use HY-IG spread as a financial fear component
• Google Trends: Surge in searches for "recession", "crash", "war" as additional fear signal

Risk Parameters

Installation & Setup

clawhub install polymarket-macro-fear-index-trader

Requires: SIMMER_API_KEY environment variable.

Cron Schedule

Runs on demand or via automaton. Cron is set to null -- configure it in the Simmer UI when ready.

Safety & Execution Mode

The skill defaults to paper trading (venue="sim"). Real trades only execute when --live is passed explicitly.

The automaton cron is set to null -- it does not run on a schedule until you configure it in the Simmer UI. autostart: false means it won't start automatically on install.

Required Credentials

Tunables (Risk Parameters)

All risk parameters are declared in clawhub.json as tunables and adjustable from the Simmer UI without code changes. They use SIMMER_-prefixed env vars so apply_skill_config() can load them securely.

Dependency

simmer-sdk is published on PyPI by Simmer Markets.

• PyPI: https://pypi.org/project/simmer-sdk/
• GitHub: https://github.com/SpartanLabsXyz/simmer-sdk
• Publisher: hello@simmer.markets

Review the source before providing live credentials if you require full auditability.