Investors were net buyers in December,
increasing exposure to equity markets
The Investor Movement Index® (IMXSM) increased to 5.55 in
December, up 7.4 percent from its November score of 5.17. 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.
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TD Ameritrade Dec. 2019 Investor Movement
Index (Graphic: TD Ameritrade)
The December IMX score reached its highest point in 14 months;
although it was considered “Middle” compared to historic averages,
it marked a willingness for investors to take on more exposure as
the markets hit all-time highs. This is the first time in 2019 the
IMX reading was not considered “Low” or “Moderately Low.”
“The December rally was fueled by strong retail industry news,
encouraging industrial profit numbers from China and continued
optimism around a U.S.-China trade deal getting signed in January,”
said JJ Kinahan, chief market strategist at TD Ameritrade. “The
positive headlines encouraged investors to increase their exposure
in a controlled fashion for the third month in a row, and they
finished the year as net buyers of equities.”
In December, the S&P 500 and Nasdaq Composite crossed
historic levels at 3,200 and 9,000, respectively, for the first
time. All three major U.S. indices saw positive gains, with the
Nasdaq leading the way, up 3.9 percent during the period. The
S&P increased 3.2 percent during the month, with the Dow Jones
Industrial Average up 2.1 percent. The Federal Reserve held its
benchmark interest rate steady after lowering it during the
previous three meetings. Movement on the U.S.-China trade front, in
addition to data signaling an improvement in the Chinese economy,
added optimism surrounding global financial markets.
Retail investors at TD Ameritrade net bought popular names
during the December IMX period, including:
- Walt Disney Co. (DIS)
- Occidental Petroleum Corp. (OXY)
- Microsoft Corp. (MSFT)
- Boeing Co. (BA)
TD Ameritrade clients also used record highs to net sell some
popular names, including:
- Facebook Inc. (FB)
- Alibaba Group (BABA)
- Johnson & Johnson (JNJ)
- Netflix Inc. (NFLX)
Millennial Buys & Sells In December, there were a few
key differences in the stocks TD Ameritrade’s millennial clients
net bought when compared to the total population. Millennials net
bought Uber Inc. (UBER), AT&T Inc. (T) and Exxon Mobil Co.
(XOM).
When it comes to net sold stocks, millennials differed from the
total client population with Tesla Inc. (TSLA) and Shopify Inc.
(SHOP).
2019 in Review The IMX entered 2019 at a six-year low as
geopolitical issues related to U.S.-China tariffs, and the
potential worldwide slowdown associated with it, made headlines. By
May, optimism of a China trade deal coupled with a low unemployment
rate helped the IMX reach a six-month high. Over the summer, the
IMX dipped once again as trade-related policy concerns led to
investors favoring less-risky assets, including fixed income
products. The IMX began to rebound this fall, beginning with
investors reacting to a positive earnings season and Fed easing in
October.
The five most popular stocks net bought by TD Ameritrade clients
throughout the year were:
- Boeing Co. (BA)
- Walt Disney Co. (DIS)
- Occidental Petroleum Co. (OXY)
- AbbVie Inc. (ABBV)
- CVS Health Corp. (CVS)
The five most popular stocks net sold throughout the year by
clients included four FAANG stocks:
- Facebook Inc. (FB)
- Apple Inc. (AAPL)
- Netflix Inc. (NFLX)
- Amazon Inc. (AMZN)
- Bank of America Corp. (BAC)
Millennials had a similar group of top buys and sells in 2019.
Microsoft Corp. (MSFT) and Tesla Inc. (TSLA) were in the top five
net buys for millennials, but not the total client population. For
net sold, Alibaba Group (BABA) made the list for millennials, but
not the larger group.
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 more than 11 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 January 2010; to view the full report from
December 2019; 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. All investments involve risk including the possible loss of
principal. Please consider all risks and objectives before
investing.
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.
About TD Ameritrade Holding Corporation TD Ameritrade
provides investing services and education to approximately 12
million client accounts totaling approximately $1.3 trillion in
assets, and custodial services to more than 7,000 registered
investment advisors. We are a leader in U.S. retail trading,
executing an average of approximately 800,000 trades per day for
our clients, more than a quarter of which come from mobile devices.
We have a proud history of innovation, dating back to our start in
1975, and today our team of 10,000-strong is committed to carrying
it forward. Together, we are leveraging the latest in cutting edge
technologies and one-on-one client care to transform lives, and
investing, for the better. Learn more by visiting TD Ameritrade’s
newsroom at www.amtd.com, or read our stories at Fresh
Accounts.
Brokerage services provided by TD Ameritrade, Inc., member FINRA
(www.FINRA.org) / SIPC (www.SIPC.org)
Source: TD Ameritrade Holding Corporation
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version on businesswire.com: https://www.businesswire.com/news/home/20200106005185/en/
Cassie Burica Specialist II, Corporate Communications (773)
435-3215 cassie.burica@tdameritrade.com
Jeff Goeser Managing Director, Investor Relations (402) 597-8464
jeffrey.goeser@tdameritrade.com
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