TD Ameritrade Investor Movement Index: IMX score drops in May uncertainty
OMAHA, Neb.–(BUSINESS WIRE)–The Index of Investor Movements® (IMX℠) fell to 5.86 in May from 6.33 in April. The IMX is TD Ameritrade’s proprietary behavioral-based index, aggregating the positions and activity of Main Street investors to measure what investors were actually doing and how they were positioning themselves in the markets.
The reading for the four-week period ending May 27, 2022 ranks “moderate” compared to historical averages.
“IMX periods that fall during an earnings cycle typically see high activity as investors assimilate updated information from companies reporting earnings and offering guidance on future expectations. In May, however, uncertainty and the cautious outlook from reporting companies and analysts has pushed investors away,” according to Shawn Cruz, Chief Trading Strategist, TD Ameritrade. “For the first time since December 21, TD Ameritrade clients were sellers net of shares in May.”
May was another month of high market volatility. The S&P 500 traded in just under a 500 point range between its high of 4307.66 on May 4 and 3810.32 on May 23, a new low for this year and a brief dip in the bear market territory. Remarkably, the benchmark ended almost unchanged month-over-month as it had its best week since November 2020 during the last full trading week of the period. Although inflation concerns continued to underline the tone of the markets, the 10-year Treasury yield fell slightly to 2.844% from 2.887% after hitting new year-to-date highs of 3.167% on May 9. Despite stagnant yields and mounting economic concerns, the financial sector managed to post a 2.57% gain for the month. However, this was overshadowed by the nearly 15% gain posted by the energy sector, the best performing sector in May. The Consumer Staples and Consumer Discretionary sectors struggled, down 4.73% and 4.91% respectively, as disappointing results from several retailers, including Walmart (WMT) and Target (TGT), triggered sales in retail names. Real estate, however, fell 5.13%, making it the worst performing sector for the month.
TD Ameritrade clients were net sellers of equities in May, but again were strong buyers of fixed income instruments. Some of the popular stock names bought in May were:
Apple Inc. (AAPL)
Amazon.com Inc. (AMZN)
NVIDIA Corporation (NVDA)
Advanced Micro Devices Inc. (AMD)
Walt Disney Company (DIS)
Names sold during the period included:
Exxon Mobil Corp. (XOM)
Walmart Inc. (WMT)
American Airlines Group Inc. (AAL)
Visa Inc. (V)
Merck & Co. Inc. (MRK)
Millennial buying and selling
Like the general clientele, TD Ameritrade’s millennial clients reduced their exposure during the May period and were net sellers of equities overall. Millennial TD Ameritrade customers and the general TD Ameritrade customer population favored Tesla (TSLA) and Amazon (AMZN) as the consumer discretionary names came under pressure. Nvidia (NVDA) Rewarded After Quarterly Earnings Report Beats Expectations Despite Cautious Outlook; TD Ameritrade’s millennial customers and the entire TD Ameritrade customer base were net buyers of the semiconductor giant. Millennial TD Ameritrade customers and the general TD Ameritrade population were net sellers of American Airlines (AAL), Delta Airlines (DAL) and United Airlines (UAL) as inflation continued to obscure the economic situation. In addition to airlines, TD Ameritrade’s millennial customers also sold travel-related names Airbnb (ABNB) and Royal Caribbean Cruises (RCL). TD Ameritrade’s millennial clients were net buyers in four of the S&P sectors: Communication Services, Consumer Discretionary, Consumer Staples and Financials.
Among the most popular names bought on the net in May, millennials distinguished themselves from the general customer population by buying Palantir Technologies Inc. (PLTR). Among the most popular names sold on the net, millennials stood out by selling Airbnb Inc. (ABNB) and Royal Caribbean Cruises Ltd. (RCL).
The IMX value is calculated based on a complex proprietary formula. Each month, TD Ameritrade pulls a sample of its funded account customer base, which includes all accounts that have transacted in the previous month. The holdings and positions of this statistically significant sample are evaluated to calculate the individual scores, and the median of these scores represents the monthly IMX.
For more information on the Investor Movement Index, including historical IMX data dating back to January 2010; to view the full May 2022 report or to sign up for future IMX news alerts, please visit www.tdameritrade.com/IMX. Additionally, TD Ameritrade clients can plot 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 buy, sell or hold recommendation by TD Ameritrade. All investments involve risk, including possible loss of principal. Please consider all risks and objectives before investing.
Past performance of a security, strategy or index does not guarantee 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 financial situation and objectives 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 trading volume or financial performance of clients for TD Ameritrade.
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