Retail investors are net buyers for a fourth consecutive month, favor leading Tech stocks
June 05, 2017 — OMAHA, Neb.–(BUSINESS WIRE)–The May 2017 Investor Movement Index® gained momentum and jumped up a percent from April’s pullback, coming in at 6.13, TD Ameritrade, Inc. (“TD Ameritrade”), a broker-dealer subsidiary of TD Ameritrade Holding Corporation (Nasdaq: AMTD) announced today.
The Investor Movement Index, or the IMXSM, is a proprietary, behavior-based index created by TD Ameritrade that aggregates Main Street investor positions and activity to measure what investors are actually doing and how they are positioned in the markets.
The May 2017 Investor Movement Index for the four weeks ending May 26, 2017, reveals:
- Reading: 6.13 (compared to 6.06 in April)
- Trend direction: Positive
- Trend length: 1 month
- Score relative to historic ranges: High
TD Ameritrade clients continued a four-month trend of overall net buying during the May IMX period. Client accounts showed increased equity exposure compared to the market, which was bolstered by higher relative volatility in widely held names. Market activity remained favorable during the period as indices reached new highs− S&P closed at a historic high of over 2,400− and nearly 75 percent of S&P 500 companies beat earnings estimates, reporting the highest year-over-year earnings increase since 2011.
Increasing equity exposure
The trend of bullish activity in the market has continued our clients’ desire to increase equity exposure and as a result we again see net buying of Apple, Facebook and Amazon− three stalwart stocks for our clients,” said JJ Kinahan, chief market strategist for TD Ameritrade. “As the yield stall continues, we see clients searching for yield within stocks, such as AT&T and Verizon.”
TD Ameritrade clients showed strong interest in Technology stocks during the May period as net buyers of Apple Inc. (AAPL), Facebook Inc. (FB) and Amazon Inc. (AMZN). All three companies showed positive movement− Apple continued its upward price trend, Amazon closed in on one thousand dollars a share and Facebook reported better than expected earnings. Automakers Ford (F) and Tesla (TSLA) were also net bought during the period, despite Ford changing management and missing on its April earnings. Tesla, on the other hand, reached a 52-week high in May and has continued higher. Another favored sector was Telecommunications, TD Ameritrade clients increased their net holdings of AT&T (T) and Verizon (VZ). Additional popular names bought include Advanced Micro Devices Inc. (AMD) and Berkshire Hathaway Inc. (BRK.B).
TD Ameritrade clients were net sellers of Consumers Goods and Services companies for a second month in a row, including Whole Foods Market Inc. (WFM) and Arconic Inc. (ARNC). Newell Brands Inc. (NWL), the parent company of outdoor and recreation brands, such as Coleman and Marmot, was net sold; a potential result of the company divesting its winter sports business. Additionally, Bristol-Meyers Squibb (BMY), who received notice that the FDA granted a priority review designation for one of its drugs, was net sold. Citigroup (C) was net sold after the stock reached a yearly high during the period, and American Airlines Group Inc. (AAL) was net sold despite expectations that summer travel will reach an all-time high. Net selling activity also included Mobileye (MBLY) and Yahoo, Inc. (YHOO).
About the IMX
The IMX value is calculated based on a complex proprietary formula. Each month, TD Ameritrade pulls a sample from its client base of 7 million funded accounts, which includes all accounts that completed a trade in the past month. The holdings and positions of this statistically significant sample are evaluated to calculate individual scores, and the median of those scores represents the monthly IMX.
For more information on the Investor Movement Index, including historical IMX data going back to December 2010; to view the full report from May 2017; or to sign up for future IMX news alerts, please visit www.tdameritrade.com/IMX. Additionally, TD Ameritrade clients can chart the IMX using the symbol $IMX in either the thinkorswim® or TD Ameritrade Mobile Trader platforms.
Inclusion of specific security names in this commentary does not constitute a recommendation from TD Ameritrade to buy, sell, or hold.
Past performance of a security, strategy, or index is no guarantee of future results or investment success.
Historical data should not be used alone when making investment decisions. Please consult other sources of information and consider your individual financial position and goals before making an independent investment decision.
The IMX is not a tradable index. The IMX should not be used as an indicator or predictor of future client trading volume or financial performance for TD Ameritrade.
For the latest TD Ameritrade news and information, follow the company on Twitter, @TDAmeritradePR.
Source: TD Ameritrade Holding Corporation
About TD Ameritrade Holding Corporation
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