Schwab Trading Activity Index™: Score Declines to Moderate-Low Levels in April Amid Market Volatility
May 06 2024 - 11:30AM
Business Wire
Schwab clients were net buyers in April,
finding several opportunities to increase exposure, notably in
technology-related names
The Schwab Trading Activity Index™ (STAX) decreased to 48.87 in
April, down from its score of 51.65 in March. The only index of its
kind, the STAX is a proprietary, behavior-based index that analyzes
retail investor stock positions and trading activity from Schwab’s
millions of client accounts 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 April 2024
(Graphic: Charles Schwab)
The reading for the four-week period ending April 26, 2024,
ranks “moderate low” compared to historic averages as investment
exposure decreased.
“The April STAX period was marked by volatility as major indices
took a breather from a five-month winning streak and had their
worst month since September, despite solid corporate earnings,”
said Joe Mazzola, Head Trading & Derivatives Strategist at
Charles Schwab. “While Schwab clients were net buyers of equities,
the investor enthusiasm that characterized the March results began
to wane in April, pushing down the STAX score for the month.
Clients were more discerning with their purchases, preferring to
gravitate towards companies with strong fundamentals, particularly
those with compelling generative AI solutions. Those companies
continue to rank near the top of our client buy lists.”
U.S. equity markets fell during the April STAX period and
indices experienced several single-day losses of greater than 2%
following disappointing economic data releases. The CBOE Volatility
Index (VIX) spiked from 13.01 to 15.03, reflecting additional
perceived downside risks to equities. On April 4, initial jobless
claims came in at 221,000, slightly higher than the 214,000
expected, and the U.S. Bureau of Labor and Statistics’ Employment
Situation Summary released on April 5 showed that nonfarm payrolls
increased by 303,000 in March – significantly better than the
200,000 expected. The unemployment rate was little changed at 3.8%.
The Consumer Price Index (CPI) rose by 0.4% for the month of March,
bringing the 12-month increase to 3.5%, before seasonal adjustment.
The Producer Price index (PPI) came in at 0.2%, corresponding to a
12-month rise of 2.1% versus economists’ projections of 2.3%. U.S.
Retail Sales for March increased 0.7% from the previous month,
versus an expected increase of just 0.3%.
On April 3, U.S. Federal Reserve Chairman Jerome Powell
commented that core inflation stood at 2.8% versus 4.8% one year
earlier. On April 25, Core Personal Consumption Expenditures (PCE)
were reported at 3.7% versus expectations of 3.4%. The S&P 500
rose 0.22% during the April STAX period and closed slightly lower
for the full month. The Nasdaq Composite fell 2.8% to close the
period at 15,927.90 and the Dow Jones Industrial Average fell 3.9%
during the period to close at 38,239.66. The 10-year Treasury yield
also rose by a sharp 11.01% to close the period at 4.669. The U.S.
Dollar Index rose slightly, closing at 105.41, and June Crude Oil
futures rose by 0.82% to close the April STAX period at $83.85.
Popular names bought by Schwab clients during the period
included:
- NVIDIA Corp. (NVDA)
- Advanced Micro Devices Inc. (AMD)
- Super Micro Computer Inc. (SMCI)
- Amazon.com Inc. (AMZN)
- Microsoft Corp. (MSFT)
Names net sold by Schwab clients during the period included:
- Walt Disney Co. (DIS)
- PayPal Holdings Inc. (PYPL)
- Exxon Mobil Corp. (XOM)
- Devon Energy Corp. (DVN)
- Occidental Petroleum Corp. (OXY)
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
millions 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, Inc. 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.
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.
0524-0Z61
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version on businesswire.com: https://www.businesswire.com/news/home/20240506263012/en/
At the Company Margaret Farrell
Director, Corporate Communications (203) 434-2240
margaret.farrell@schwab.com
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