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To: Trebor who wrote (3562)3/2/1999 11:55:00 PM
From: DD™  Read Replies (1) of 15132
 
Distribution is another term for "net" selling. When selling exceeds buying for a given time period, distribution is said to be occurring.

Accumulation/distribution, in a general/overall market sense, most commonly references institutional buying/selling activity. Specifically, it references net block buying/selling by these money managers.

IBD lists accumulation/distribution ratings for both the major indexes/markets (as well as block sales) and for individual stocks.

If the major averages are in an uptrend, or are trending sideways in trading range while there is net selling (distribution) taking place, this can be construed as a negative as the "big money" is bailing, leaving the retail investors to serve as "bagholders".

On a daily comparative basis, if the major averages begin stalling on heavier volume, this is also a sign that distribution is overtaking accumulation.

Accumulation/Distribution is an important "technical internal" to observe daily when assessing the overall heath of the market.

DD
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