Retail investors stayed cautious, reducing risk even during all-time market highs
August 05, 2019 — OMAHA, Neb.–(BUSINESS WIRE)–The Investor Movement Index® (IMXSM) measured at 4.60 in July, down less than one percent from its June score. The IMX is TD Ameritrade’s proprietary, behavior-based index, aggregating Main Street investor positions and activity to measure what investors actually were doing and how they were positioned in the markets.
The reading for the four-week period ending July 26, 2019 remained relatively unchanged from the previous month. The score ranks “Moderately Low” compared to historic averages and continues a nine-month trend of below-average IMX scores.
“Investors continue to look for opportunities in the market, and in July they were leaning toward fixed income and away from equities,” said JJ Kinahan, chief market strategist at TD Ameritrade. “We are keeping a close eye on how the latest stream of news like the July rate cut, tariff negotiations and Brexit will affect the markets moving forward.”
Dow passes 27,000 for the first time
During July, the S&P 500 surpassed the 3,000 mark for the first time ever, while the Dow Jones Industrial Average passed 27,000 for the first time. All three major equity indices reached all-time highs during the period. The U.S. economy grew at a 2.1 percent rate in the second quarter, with consumer spending increasing 4.3 percent and offsetting a decline in business investment. Congress and the White House also reached a deal on spending on the debt ceiling to avoid a looming fiscal crisis.
Despite their decreased exposure to equities, retail investors at TD Ameritrade found some popular names to buy during the July IMX period, including:
- Abbvie Inc. (ABBV)
- Walt Disney Co. (DIS)
- Canopy Growth Corp. (CGC)
- Aurora Cannabis Inc. (ACB)
TD Ameritrade clients also net sold many popular names during the period, including:
Amazon Inc. (AMZN)
Apple Inc. (AAPL)
Intel Corp. (INTC)
Facebook Inc. (FB)
Millennial Buys & Sells
During the July IMX period, millennials with TD Ameritrade accounts chose a few names to net buy that the overall population did not, including Uber Inc. (UBER) and Chesapeake Energy Corp. (CHK). Like the larger client population, millennials also net bought Disney (DIS), Abbvie Inc. (ABBV) and pot stocks Canopy Growth Corp. (CGC) and Aurora Cannabis Inc. (ACB).
Millennials were net sellers of most of the same companies as the general population, including Apple (AAPL), Amazon Inc. (AMZN) and Facebook (FB). Unlike the total population, they were also net sellers of JD.com (JD).