TD Ameritrade Investor Movement Index: Economic optimism drives IMX score higher in May
OMAHA, Neb .– (COMMERCIAL THREAD)–The Investor movement index® (IMXSM) increased from 0.18 to 8.32 in May, from 8.14 in April. The IMX is TD Ameritrade‘s proprietary behavior-based index, which aggregates the positions and activity of Main Street investors to measure what investors actually did and how they positioned in the markets.
The reading for the four week period ending May 28, 2021 ranks “High” compared to historical averages.
“Clients took some risk in May, favoring assets like US ETFs and fixed income over stocks,” said JJ Kinahan, chief market strategist, TD Ameritrade. “This is the first time since October of last year that clients are net sellers of equities, while mostly maintaining their level of global exposure to the Markets in an environment where the Indices are virtually unchanged. This is often due to the fact that stock purchases are made in higher beta stocks. Looking ahead, it looks like economic optimism is on the rise – the economy is slowly but steadily strengthening and the market appears to have gotten rid of some of the recent inflation worries for now. ”
Equity markets were mixed over the period. The S&P 500 and the Dow Jones Industrial Average both rose 0.55% and 1.90% respectively. The Nasdaq Composite fell 1.56%. The economic data was mostly positive during the month. Consumer spending continued to rise, up 0.5%, as the CDC continued to ease mask mandates and more Americans spent on services, restaurants and travel. New jobless claims fell more than expected to set a new pandemic-era low, as President Biden unveiled a $ 6 trillion spending plan with big increases proposed for infrastructure. The Federal Reserve has started telegraphing a possible change in its accommodative monetary policy as evidence accumulates of a continued economic recovery and rising inflation.
TD Ameritrade clients were net buyers overall during the May IMX period, but were net sellers of stocks. It was the first time since October that stocks were sold net. Some of the popular equity securities purchased during the period were:
Advanced Micro Devices Inc. (AMD)
Apple Inc. (AAPL)
AirBnB Inc. (ABNB)
DraftKings Inc. (DKNG)
Ford Motor Co. (F)
Microsoft Corp. (MSFT)
Tesla Inc. (TSLA)
The Walt Disney Company (DIS)
TD Ameritrade clients were net sellers of stocks during this period, including:
Moderna Inc. (ARNM)
Nokia Inc. (NOK)
Pfizer Inc. (PFE)
Walmart Inc. (WMT)
Wells Fargo Inc. (WFC)
The IMX value is calculated based on a complex proprietary formula. Each month, TD Ameritrade draws a sample of its funded account customer base, which includes all accounts that have 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 these 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 for May 2021; or to subscribe to future IMX news alerts, please visit www.tdameritrade.com/IMX. Additionally, TD Ameritrade clients can plot the IMX using the symbol $ IMX in the thinkorswim® or thinkorswim mobile platforms.
The inclusion of specific security names in this commentary does not constitute a recommendation by TD Ameritrade to buy, sell or hold. All investments involve risk, including the possible loss of capital. Please consider all the risks and objectives before investing.
Past performance of a security, strategy or index is no guarantee of future results or the success of investments.
Historical data should not be used alone when making investment decisions. Please consult other sources of information and consider your financial situation and personal goals before making an independent investment decision.
The IMX is not a tradable index. IMX should not be used as an indicator or predictor of future client trading volume or the financial performance of TD Ameritrade.
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Source: TD Ameritrade, Inc.