TD Ameritrade Investor Movement Index: IMX Lowers Amid July Volatility
August 08 2022 - 12:30PM
Business Wire
Clients reduced exposure during the period but
were net buyers of equities, seeing opportunity in Communication
Services, Energy and Materials
The Investor Movement Index® (IMXSM) decreased to 4.68 in July,
down from 5.10 in June. 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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The reading for the four-week period ending July 29, 2022 ranks
“Moderate Low” compared to historic averages.
“Despite a strong finish at the end of the month, the markets
were volatile in the face of macroeconomic concerns in July and TD
Ameritrade clients continued reducing exposure as a result,” said
Shawn Cruz, head trading strategist, TD Ameritrade. “While there’s
a good case for optimism – in particular, we saw corporate earnings
by and large avoid any anticipated ‘worst case’ scenarios – the
looming threat of inflation and a possible recession has retail
investors taking a serious look at their tolerance for risk and in
many cases, demonstrating a preference for established names with
strong underlying fundamentals.”
The July IMX period was once again characterized by elevated
volatility. Building on its strong finish in June, the S&P 500
closed out July up 218.55 points, or +5.59%. It was a busy month on
the macroeconomic front, starting with disappointing Personal
Spending figures that were accompanied by a Core Personal
Consumption Expenditures (PCE) Price Index number that showed signs
of cooling inflation. The 10 Year Treasury yield plunged below 3%
in response. The July Employment Situation data from the Bureau of
Labor Statistics (BLS) pointed to a resilient job market, sparking
optimism until hotter-than-expected inflation data in the June
Consumer Price Index (CPI) and Producer Price Index (PPI) reports
reignited concerns. Ultimately, the Federal Reserve voted to raise
the Fed Funds Rate by another 75 bps to 2.25%-2.5%, which alongside
Chairman Powell’s statements during the subsequent press conference
resulted in strong buying pressure. Corporate earnings struck a
more optimistic note, but the most notable move of the period was
the sharp drop in the 10 year treasury yield, which finished nearly
50 bps lower than at the end of June.
Despite overall reduced investment exposure, TD Ameritrade
clients were net buyers of equities in July. Some of the popular
equity names bought during the period were:
- Advanced Micro Devices Inc. (AMD)
- NVIDIA Corp. (NVDA)
- Shopify Inc. (SHOP)
- Amazon Inc. (AMZN)
- Alphabet Inc. (GOOG/GOOGL)
Names sold during the period included:
- Tesla Inc. (TSLA)
- Nio Inc. (NIO)
- Twitter Inc. (TWTR)
- Exxon Mobil Corp. (XOM)
- Netflix Inc. (NFLX)
Millennial Buys & Sells
TD Ameritrade millennial clients reduced exposure during the
July period, and unlike the general client population, they were
net sellers of equities overall.
Both TD Ameritrade millennial clients and the overall TD
Ameritrade client population favored Amazon (AMZN) for the second
month in a row, as the Consumer Discretionary giant’s recent stock
split led to a sustained increase in interest in the July period.
July was a period of strong performance for semiconductor giants
NVIDIA (NVDA) and Advanced Micro Devices (AMD), and TD Ameritrade
millennial clients mirrored the overall TD Ameritrade client
population in net buying the two companies. Apple (AAPL) beat top
and bottom line expectations with its quarterly earnings reporting
and the company provided an optimistic forecast for the rest of the
year, making it a top buy among TD Ameritrade millennial clients,
though not among the general client population. Despite being net
sellers of equities overall, TD Ameritrade millennial clients were
net buyers of four of the S&P sectors: Communication Services,
Energy, Health Care, and Materials.
TD Ameritrade millennial clients, like the overall TD Ameritrade
client population, were net sellers of electric vehicle makers
Tesla (TSLA) and Nio (NIO). Unlike the overall client population,
however, TD Ameritrade millennial clients were net sellers of
Cenntro Electric Group (CENN). Like the overall TD Ameritrade
client population, TD Ameritrade millennial clients were net
sellers of Twitter (TWTR) during the July period as the stock
rallied despite uncertainty surrounding the potential purchase of
the company by Elon Musk.
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 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 July 2022, 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 thinkorswim Mobile 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
TD Ameritrade provides investing services and education to
self-directed investors and registered investment advisors. A
leader in U.S. retail trading, we leverage the latest in cutting
edge technologies and one-on-one client care to help our clients
stay on top of market trends. Learn more by visiting
www.amtd.com.
Brokerage services provided by TD Ameritrade, Inc., member FINRA
(www.FINRA.org) / SIPC (www.SIPC.org), a subsidiary of The Charles
Schwab Corporation. TD Ameritrade is a trademark jointly owned by
TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank. ©
2022 Charles Schwab & Co. Inc. All rights reserved.
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Margaret Farrell Director, Corporate Communications (203)
434-2240 margaret.farrell@schwab.com