TD Ameritrade clients maintained exposure as volatility returned to markets during a period of mixed economic indicators and continued pandemic uncertainty

The Investor Movement Index® (IMXSM) decreased slightly to 5.69 in October, down 0.35 percent from its September score of 5.71. 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 October 2020 Investor Movement Index (Graphic: TD Ameritrade)

The reading for the five-week period ending October 30, 2020, ranks “Middle” compared to historic averages.

“In October, we saw clients maintain almost exactly the levels of exposure they held in September,” said JJ Kinahan, chief market strategist at TD Ameritrade. “While these scores remain among the highest of the year to date, they point to the continued impact of volatility on retail investors’ behavior as they remain net buyers of equities overall, maintaining but not wanting to expand exposure heading into an election. In the areas where they were willing to take risk, they did demonstrate a preference for Consumer Discretionary, Information Technology, and Energy stocks.”

Market volatility returned during the October period, with equity markets nearing all-time highs in the first two weeks of the period followed by a sell-off, with all three major U.S. indices ending lower as the period came to a close. In October, investors learned that retail sales increased during September for the fifth straight month as consumers spent heavily on vehicles, clothing, and sporting goods. Hopes of a second stimulus deal also helped push markets higher. The market rally stalled as U.S. unemployment claims rose to the highest level since the end of August, raising questions about the strength of the economic recovery. At the end of the period, COVID-19 cases began to increase worldwide with record numbers in the U.S., and numerous European counties announced additional restrictions pushing markets lower.

TD Ameritrade clients were once again net buyers of equities during the period. Some of the popular names bought during the period were:

  • Apple Inc. (AAPL)
  • AT&T Inc. (T)
  • Tesla Inc. (TSLA)
  • NIO Inc. (NIO)
  • DraftKings Inc. (DKNG)

Names net sold during the period included:

  • Moderna Inc. (MRNA)
  • Micron Inc. (MU)
  • Beyond Meat Inc. (BYND)
  • MGM Resorts International (MGM)
  • Duke Energy Corp. (DUK)

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 more than 13 million 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 October 2020; 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 approximately 13 million client accounts totaling approximately $1.5 trillion in assets, and custodial services to more than 7,000 registered investment advisors. We are a leader in U.S. retail trading, executing more than 3 million daily average revenue trades per day for our clients, one-third of which come from mobile devices. Together, we are leveraging the latest in cutting edge technologies and one-on-one client care to transform lives, and investing, for the better. Learn more by visiting TD Ameritrade’s newsroom at www.amtd.com, or read our stories at Fresh Accounts.

Brokerage services provided by TD Ameritrade, Inc., member FINRA (www.FINRA.org) / SIPC (www.SIPC.org), and a wholly owned subsidiary of The Charles Schwab Corporation. TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank. © 2020 Charles Schwab & Co. Inc. All rights reserved. Member SIPC (www.SIPC.org).

Source: TD Ameritrade Holding Corporation

Margaret Farrell Sr. Manager, Corporate Communications (203) 434-2240 margaret.farrell@tdameritrade.com

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