Schwab Trading Activity Index™: Score Rises Modestly Amid New-Year Rally
February 05 2024 - 11:30AM
Business Wire
Schwab clients were net buyers in January, with
the most pronounced buying within the Consumer Discretionary,
Energy and Health Care sectors
The Schwab Trading Activity Index™ (STAX) increased to 44.73 in
January, up slightly from its score of 44.56 in December. The STAX
is a proprietary, behavior-based index that analyzes retail
investor stock positions and trading activity to illuminate what
investors were actually doing and how they were positioned in the
markets each month.
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Schwab Trading Activity Index January
2024 (Graphic: Charles Schwab)
The reading for the four-week period ending January 26, 2023
ranks “moderate low” compared to historic averages.
“Schwab’s clients were net buyers of equities in January,” said
Joe Mazzola, Director of Trading and Education at Charles Schwab.
“While exposure was still relatively low when viewed in a
historical context, we saw that for the most part, our clients
stayed in step with the market rally, finding opportunities to
increase exposure in particular to the ‘Magnificent Seven’
companies as the new year began.”
U.S. equity markets picked up right where they left off last
year, posting solid gains during the January STAX period. Economic
data supported the rally. The U.S. Bureau of Labor and Statistics’
Employment Situation Summary released on January 5 showed that
nonfarm payrolls increased by 216,000 in December, which was better
than expected. The unemployment rate was unchanged at 3.7%. On
January 11, it was reported that the Consumer Price Index (CPI)
rose by 0.3% for the month of December to 3.4% year-over-year,
slightly hotter than expected. Later in the month, the U.S. Bureau
of Economic Analysis released its first estimate of fourth quarter
Gross Domestic Product (GDP), and the release showed an annualized
growth rate of 3.3% during the quarter. While this was a notable
slowdown from the third quarter rate of 4.9%, it was much better
than the street forecast of 2%. This more resilient economic
picture pushed back on the market’s anticipation of significant
monetary easing in 2024.
During the January STAX period, the S&P 500 (SPX) continued
to reach new heights, with a rise of 2.54% to close at 4890.97. The
CBOE Volatility Index (VIX) inched higher from 12.45 to 13.26,
reflecting an increase in risk premium, though it remained low by
historical measures. The 10-year Treasury yield rose to 4.14%,
reversing from its recent trend lower. The U.S. Dollar Index
strengthened during the period, ending at 103.43. March Crude Oil
Futures moved 8.9% higher, settling at $78.01 per barrel.
Popular names bought by Schwab clients during the period
included:
- Tesla Inc. (TSLA)
- NVIDIA Corp. (NVDA)
- Amazon.com Inc. (AMZN)
- Microsoft Corp. (MSFT)
- Advanced Micro Devices (AMD)
Names net sold by Schwab clients during the period included:
- Bank of America Corp. (BAC)
- Walmart Inc. (WMT)
- General Motors Co. (GM)
- Carnival Corp. (CCL)
- Warner Bros. Discovery Inc. (WBD)
About the STAX
The STAX value is calculated based on a complex proprietary
formula. Each month, Schwab pulls a sample from its client base of
funded accounts, which includes 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 STAX.
For more information on the Schwab Trading Activity Index,
please visit www.schwab.com/investment-research/stax. Additionally,
Schwab clients can chart the STAX using the symbol $STAX in either
the thinkorswim® or thinkorswim Mobile platforms.
Investing involves risk, including loss of principal. Past
performance is no guarantee of future results.
Content intended for educational/informational purposes only.
Not investment advice, or a recommendation of any security,
strategy, or account type.
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 STAX is not a tradable index. The STAX should not be used as
an indicator or predictor of future client trading volume or
financial performance for Schwab. STAX data includes that from
accounts of TD Ameritrade clients which have not yet transferred to
Charles Schwab & Co., Inc., as part of our planned
integration.
TD Ameritrade, Inc., member FINRA/SIPC, 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.
About Charles Schwab
At Charles Schwab, we believe in the power of investing to help
individuals create a better tomorrow. We have a history of
challenging the status quo in our industry, innovating in ways that
benefit investors and the advisors and employers who serve them,
and championing our clients’ goals with passion and integrity.
More information is available at aboutschwab.com. Follow us on
X, Facebook, YouTube, and LinkedIn.
0224-GZVW
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version on businesswire.com: https://www.businesswire.com/news/home/20240205765717/en/
At the Company Margaret Farrell
Director, Corporate Communications (203) 434-2240
margaret.farrell@schwab.com
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