TD Ameritrade's Investor Movement Index: Clients Were Net Buyers of Equities in January
Overall market volatility paired with relative stability of some
widely held positions counteracted client buying to lower IMX score
TD Ameritrade, Inc. (“TD Ameritrade”), a broker-dealer subsidiary of TD
Ameritrade Holding Corporation (Nasdaq:AMTD), is today releasing the
Investor Movement Index® reading for January 2016. 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.
This Smart News Release features multimedia. View the full release here:
The January 2016 Investor Movement Index for the four weeks ending
January 29, 2016, reveals:
Reading: 4.52 (compared to 4.92 in December)
Trend direction: Negative
Trend length: 1 month
Score relative to historic ranges: Middle
decreased to 4.52 in January while the S&P 500 plunged lower, having its
worst start to a year since 2010.
TD Ameritrade clients were net buyers of equities in January, activity
that usually helps to increase an account’s relative exposure to the
market. This month, however, an increase in overall market volatility
coupled with the relative stability of some widely held positions
resulted in a decrease in the IMX reading.
“The equity market decline in January made for a rough month for many
investors,” said Nicole Sherrod, managing director of trading at TD
Ameritrade. “There’s no shortage of factors for investors to weigh as
they determine how to move forward. However, many of our clients seized
the decline in the broad markets as a buying opportunity in some of
their favorite companies. We saw net buying in dividend paying and lower
Volatility of the S&P 500 as measured by the VIX remained elevated
throughout January, never closing below 19. For context, the VIX’s
average closing price in 2015 was around 17. This volatility translated
into lower prices, as both the S&P 500 and the Dow Jones Industrial
Average lost nearly 6% during the January IMX period. Both the S&P 500
and Dow Jones Industrial Average fell back to August 2015 levels, when
markets saw a sharp decline. The other major market indices also
declined, with the Russell 2000 losing about 10% — driving it to values
not seen since 2013 — while the NASDAQ Composite was off more than 8%.
Global economic concerns, including sharp sell offs in the Chinese stock
market that triggered circuit breakers and halts to trading, seemed to
drag the markets lower. An increase in crude oil supply put pressure on
the price of that commodity, which seemed to affect the stock markets
adversely. As stock markets plunged, treasury bonds rallied indicating a
flight to safety. Dividend paying stocks seemed to also outperform the
broad equity markets as indicated by the Dow Jones U.S. Select Dividend
January earnings announcements seemed to draw some attention within TD
Ameritrade client accounts. Facebook Inc. (FB) and Apple Inc. (AAPL)
both announced earnings in January and were net buys. Facebook’s share
price surged after it beat expectations in both earnings and revenue.
Netflix.com (NFLX), which announced a global expansion of its streaming
video offering earlier than expected, was also a net buy in January.
Dividend payers were also popular net buys. AT&T Inc. (T), Verizon Inc.
(VZ) and Ford Motor Company (F) all have relatively high dividend yields
and were net buys during the most recent IMX period as well.
Despite being net buyers of equities overall, there were some companies
that TD Ameritrade clients net sold in January. Yahoo! (YHOO) traded
down towards a level of support around $28 per share in January and was
net sold. The company has been in the news recently after abandoning its
plan to spin off its stake in Alibaba Holding Group (BABA), which was
also net sold in January. Alibaba’s shares have been down amid concerns
about the Chinese economy. Keurig Green Mountain (GMCR) was another
popular name that saw net selling. The company’s share price has been
tightly range bound since early December when a merger was announced
that would take the company private.
The IMX value is calculated based on a complex proprietary formula. Each
month, TD Ameritrade pulls a sample from its client base of 6 million
funded accounts that 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 January 2016, or to sign up for future IMX news alerts, please
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
Source: TD Ameritrade Holding Corporation
About TD Ameritrade Holding Corporation
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to help make investing and trading easier to understand and do. Online
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