Omaha, Neb. – (work wire)–The Investor Movement Index® (IMXSM) to 4.47 in September, down from 4.82 in August. IMX is a proprietary, behavior-based index of TD Ameritrade that aggregates the attitudes and activity of Main Street investors to gauge what investors are actually doing and how they are positioned in the markets.
The reading for the four-week period ending September 30, 2022 ranks as “low” compared to historical averages.
“After bucking the trend and increasing market exposure for the first time all year in August, TD Ameritrade clients again reduced exposure in September,” said Sean Cruz, chief trading analyst, TD Ameritrade. “From the Fed’s commitment to a hawkish approach to fighting inflation, to historical fluctuations in currency values, to mixed jobs data and crude oil taking a hard landing, it is understandable that retail traders took a risk-off approach in September, turning to fixed income and name-based investing. on solid foundations.”
Several macroeconomic catalysts increased market volatility in September as the S&P 500 fell 11.63% to its lowest year-to-date level. And while the job growth numbers released by the Bureau of Labor Statistics at the beginning of the month were in line with the street estimates, the report also showed that the unemployment rate rose slightly. Despite this, the FOMC continued on its path of tightening monetary policy and raised the federal funds rate by another 75 basis points. Federal Reserve Chairman Jerome Powell made a tough commentary tightening the Fed’s commitment to address inflation after the Consumer Price Index (CPI) showed a steady and hotter core inflation rate than expected. This caused the CBOE Market Volatility Index (VIX) to dip back above 30, a threshold historically associated with high volatility, in the late period.
In addition, there was massive volatility in the US Treasury markets as 10-year yields surged to levels not seen in over a decade and crude oil fell as demand concerns drove commodities down more than 14% during the period. Currency volatility was another catalyst, as the US dollar continued to climb in contrast to European currencies in particular. The British Pound Sterling (GBP) briefly traded close to parity with the US Dollar after the Bank of England’s emergency intervention to relaunch its bond-buying program, and the Euro (EUR) also suffered, spending most of the period below par with the US Dollar as prices surged as prices continued to shake Euro-zone.
Clients of TD Ameritrade were net buyers of stocks overall, seeing lower market prices as an opportunity to increase exposure in some of the individual names. Some of the common stock names that were bought during the period were:
NVIDIA Corp. (NVDA)
Intel Corp (INTC)
Advanced Micro Devices Inc. (AMD)
Apple Inc. (AAPL)
AT&T Inc. (T)
The names sold during the period included the following:
Netflix Corporation (NFLX)
Exxon Mobil Corporation (XOM)
BP plc (BP)
Snap Inc. (SNAP)
Roblox Corporation (RBLX)
Millennium buys and sells
TD Ameritrade Millennial clients reduced exposure during the September period, but were net buyers of the shares, reflecting the total number of TD Ameritrade clients.
Both TD Ameritrade Millennial customers and TD Ameritrade customers generally favored semiconductor giants Nvidia (NVDA), Intel (INTC), and Advanced Micro Devices (AMD) as the chip segment underperformed the broad market as a whole.
Both TD Ameritrade Millennial clients and total TD Ameritrade clients were net sellers of Snap (SNAP) as the social media company slipped near year-to-date (YTD) lows, but TD Ameritrade Millennial clients diverge from the total number of clients in net Meta buying Platforms (META), the parent company of Facebook and Instagram, as it charted new year-to-date lows during the period. Netflix (NFLX) was a name sold by both peoples amid a relatively outperformance during this period, with optimism about its plans to launch an ad-supported version of the streaming service, sending the stock price up.
TD Ameritrade Millennial clients were net sellers of Bed Bath and Beyond (BBBY) as “meme” stock lost a favorite during the period, losing nearly half its value amid fundamental uncertainty and waning interest in trading in the name. TD Ameritrade Millennial clients were net buyers of every S&P segment, but buying was particularly strong in the communications and information technology services sectors.
The value of the IMX is calculated based on a complex proprietary formula. Each month, TD Ameritrade draws a sample of its customer base from funded accounts, which includes all accounts that completed a transaction in the past month. The holdings and positions of this statistically significant sample are evaluated to calculate individual scores, and the average of those scores is represented by the monthly IMX.
For more information on the Investor Movement Index, including historical IMX data going back to January 2010; To view the full report from September 2022, or to subscribe to future IMX news alerts, please visit www.tdameritrade.com/IMX. In addition, TD Ameritrade customers can plot an IMX chart using the symbol $IMX at any Thinkorswim® or Thinkorswim Mobile platforms.
The inclusion of specific security names in this comment does not constitute a recommendation by TD Ameritrade to buy, sell or hold. All investments involve risks including potential loss of capital. Please consider all risks and objectives before investing.
The past performance of a security, strategy or indicator is not a guarantee of future results or investment success.
Historical data should not be used alone when making investment decisions. Please refer to other sources of information and consider your individual financial situation and goals before making an independent investment decision.
IMX is not a tradable indicator. IMX should not be used as an indicator or forecast of a client’s future trading volume or financial performance of TD Ameritrade.
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