Clients were net buyers overall, but net sellers of equities in May

The Investor Movement Index^® (IMX^SM) increased .18 to 8.32 in May, up from its April score of 8.14. 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 May 2021 Investor Movement Index (Graphic: TD Ameritrade)

The reading for the four-week period ending May 28, 2021 ranks “High” compared to historic averages.

“Clients took some risk off the table in May, favoring assets such as U.S. ETFs and Fixed Income over equities,” said JJ Kinahan, chief market strategist, TD Ameritrade. “It’s the first time since October of last year that clients have been net sellers of equities, while mostly maintaining their level of overall exposure to the Markets in an environment in which the Indices were mostly unchanged. This is often caused by the equity buys being in higher Beta stocks. Looking forward it seems economic optimism may be on the rise – the economy is slowly but surely gaining strength and the market seems to have shaken off some of the recent inflation worries for now.”

Equity markets were mixed during the period. The S&P 500 and Dow Jones Industrial Average both moved higher, by 0.55% and 1.90% respectively. The Nasdaq Composite moved lower by 1.56%. Economic data was mostly positive during the month. Consumer spending continued to rise, up 0.5%, as the CDC continued to loosen mask mandates and more Americans spent on services, dining out, and travel. New jobless claims fell more than expected to set a new pandemic-era low, while President Biden unveiled a $6 trillion spending plan with big proposed increases on infrastructure. The Federal Reserve began to telegraph an eventual shift away from its easy monetary policy as evidence mounts 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 equities. This marked the first time since October that equities were net sold. Some of the popular equity names bought 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 equities in this period, including:

• Moderna Inc. (MRNA)
• Nokia Inc. (NOK)
• Pfizer Inc. (PFE)
• Walmart Inc. (WMT)
• Wells Fargo Inc. (WFC)

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 May 2021; 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. © 2021 Charles Schwab & Co. Inc. All rights reserved.

Source: TD Ameritrade, Inc.

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