Good Morning Kirk,
Today's value of the IMX is now at 4.17.
The month before the IMX index bottomed in March of 2020 (Covid pandemic) the IMX stood at 4.16. The low rating were it bottomed out is 3.90.
That month was one heck of a buying time.
Just saying most people are out of the market to a substantial degree. March of 2020 had A LOT OF SELLING!
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IMX vs S&P 500
The Investor Movement Index, or the IMX, is a proprietary, behavior-based index created by TD Ameritrade designed to indicate the sentiment of retail investors.
SPX | 4026.12
125.06 (+3.21%)
IMX | 4.17
-0.08 (-1.88%)
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Investor Movement Index Summary:
November 2022
November 2022
Reading (IMX)
November 2022
4.17
-0.08 (-1.88%)
Historic range (since Jan 2010 inception)
Trends
Direction
Negative
Length
Previous trend: Negative (2 months)
Current trend: Negative (3 months)
Symbols Referenced
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AAL
AAPL
AMZN
BA
DIS
GE
GILD
GOOG
GOOGL
IBM
INTC
META
MRNA
MSFT
NFLX
NIO
NVDA
SHOP
TSLA
TSM
UAL
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Monthly Summary
Investment exposure in TD Ameritrade client accounts decreased last period. The IMX moved lower to 4.17, down 0.08, or 1.88% during the November period.
TD Ameritrade clients were net sellers of equities in November. Despite almost every S&P sector trading higher during the period, the sector mix only showed buying interest in three S&P 500 sectors: Consumer Discretionary, Energy, and Utilities. Selling was strongest in the Information Technology sector, which was up 2.58% during the November period.
The November IMX period contained both macroeconomic catalysts and much of the latest quarterly earnings season. The Employment Situation at the beginning of the month highlighted a jobs market that showed signs of moderating, easing concerns that the Federal Reserve would continue on its aggressive path of monetary tightening. The November Consumer Price Index (CPI) was released on the morning of November 10th, painting a picture of cooling inflation, and equity markets immediately surged, culminating in what was the 3rd largest points gain in the history of the S&P 500 as the index closed up 207.8 points. This was the critical session of the November period and equity markets mostly traded sideways after the 5.5% pop in response to the CPI report. The latter part of the November period was disrupted by the Thanksgiving holiday leading to reduced trading activity and volumes. The CBOE Market Volatility Index (VIX) collapsed during the November period closing at 20.57, its lowest level since mid-August, possibly indicating market participants' expectation for calmer trading waters going forward. US Treasury markets continued to drive headlines during the November period, but the 10-year yield eased lower finishing under 3.7%. The strength of the US Dollar has been a major story in 2022, but the story was different during the November period, as the US Dollar Index fell to its lowest level since mid-August, easing currency pressures globally. Energy markets also eased inflation concerns as crude oil commodity futures fell over 13% during the period.
Trading
Despite being net sellers of equities overall, there were some individual names that were bought by TD Ameritrade clients during the November IMX period. Tesla ( TSLA) underperformed the broader market by a wide margin during the November period, and TD Ameritrade clients leaned into the weakness increasing exposure in the electric vehicle giant amid its recent struggles. TD Ameritrade clients were net buyers of Taiwan Semiconductor Manufacturing Company ( TSM) as, spurred by strong October sales growth, the semiconductor giant surged over 30% during the period. Intel ( INTC) was another name TD Ameritrade clients increased exposure in during the November period, but it performed much more modestly finishing up just under 1%. Apple ( AAPL) underperformed the overall market sliding nearly 5% lower during the period, as supply chain disruptions impacting iPhone production weighed on holiday sales outlooks TD Ameritrade clients, however, saw this dip as an opportunity to increase exposure in the mega cap. TD Ameritrade clients were also net buyers of Meta Platforms ( META), parent company of Facebook and Instagram, as the social media giant announced major layoffs in efforts to cut costs amid recent struggles, increasing exposure in the name as it rallied over 12% during the period.
Additional popular names bought include Alphabet ( GOOGL)/( GOOG), Amazon ( AMZN), Walt Disney ( DIS), Microsoft ( MSFT), and Nio ( NIO).
Despite equity market strength during the November IMX period, TD Ameritrade clients were net sellers of equities overall, seeing the pop in market prices as an opportunity to decrease exposure in some individual names. Nvidia ( NVDA) reported its quarterly earnings numbers and ultimately surged over 17% during the November period. TD Ameritrade clients saw this an opportunity to reduce exposure and were net sellers of the semiconductor giant. Netflix ( NFLX) traded up to its highest level since cratering in mid April after a disastrous earnings announcement. TD Ameritrade clients were net sellers seeing the Communication Services name's recent run as an opportunity to reduce exposure. Airlines fell out of favor as TD Ameritrade clients reduced exposure and were net sellers of American Airlines ( AAL) and United Airlines ( UAL) during the November period. Similarly, TD Ameritrade clients also were net sellers of Chicago-based, plane manufacturer Boeing ( BA) as the industrial company popped 24% during the November period.
Additional names sold include General Electric ( GE), Gilead Sciences ( GILD), International Business Machines ( IBM), Moderna ( MRNA), and Shopify ( SHOP).
Inclusion of specific security names in this commentary does not constitute a recommendation from TD Ameritrade to buy, sell, or hold.
Historical Overview
TD Ameritrade's Investor Movement Index (IMX) has generally correlated with the S&P 500 as clients react to equity price movements, but the index has gone through uncorrelated periods. Beginning in January 2010, when TD Ameritrade started tracking the IMX, the index rose with equity markets until April 2010, when it peaked at 5.40. In May 2010 investors experienced the "Flash Crash" and the IMX began a sharp downward trend. The IMX didn't reach 5.00 again until the S&P 500 was well above April 2010 levels. The index eventually peaked at 5.56 in June 2011. This peak was immediately followed by a plunge in equity markets, and in the IMX, as the media was dominated by the U.S. debt ceiling debate, S&P downgrade of U.S. debt, and European debt concerns. The S&P 500 began to recover in the fall of 2011, but the IMX continued to decline until it reached a new low at the time in January 2012. As the S&P 500 began to sustain an upward trend in early 2012, the IMX started to rise. In 2013, as economic conditions improved and the S&P 500 climbed to record levels, the IMX rose to the high end of its historical range, finishing 2013 at 5.62, and continued to rise in 2014 amid geopolitical tensions related to Ukraine and the Middle East, until seeing slight declines in October and November. By the middle of 2015 the IMX had seen increases, as equity market volatility had reduced to near historical levels while the market continued its upward trend. As 2015 ended its third quarter, volatility had returned to markets, as global economic concerns and speculation around the timing and trajectory of Federal Reserve rate increases seemed to rattle overall equity markets. This uncertainty continued to play a role in the equity markets through the fourth quarter of 2015 and into early 2016. The volatility accompanying this uncertainty abated in the second quarter of 2016 and remained low until late in the third quarter. Just as it had in 2015, the IMX saw increases mid-year during the period of lower volatility. The IMX continued to climb into the fourth quarter reaching 5.83 in October 2016, its highest point in two years. A brief spike in volatility during November, timed around the U.S. presidential election, coincided with a slight pull back in the IMX, which then ended 2016 at the high end of its historical range. The IMX started 2017 with an upward trend and reaching an all-time high in April, before pausing in April as lower volatility led to a decrease in the IMX. The momentum resumed in May, with the IMX breaching 7.0 for the first time ever in July of 2017. The IMX took another brief pause in September, before following markets higher and breaching 8.0 for the first time ever in November and ending 2017 at an all-time high. Volatility returned to the markets in early 2018, and the IMX decreased for four consecutive months to start the year. The IMX then rebounded in the spring of 2018 and continued higher during the summer on the back of better-than-expected earnings and increasing equity markets. The IMX headed higher during the fall of 2018 as economic growth increased before heading lower in late 2018 as the Nasdaq Composite entered a bear market to end the year. Geopolitical issues were in the headlines during early 2019 as the U.S. and China traded tariffs. The IMX rebounded along with equity markets in the spring of 2019 on optimism of a trade deal with China and the unemployment rate nearing a 49-year low. The IMX remained range-bound during the summer of 2019 as trade-related policy concerns led to investors favoring less-risky assets, including fixed-income products. Heading into the fall of 2019, the IMX began to rebound and ended the year at the highest levels in over a year as trade war fears diminished and economic data began to improve globally. In early 2020, the bull market ended as markets pulled back due to the COVID-19 pandemic, with markets experiencing volatility not seen since the financial crisis of 2008. During the spring of 2020, the IMX reached 3.90, its lowest point in years after equity markets sold off on pandemic fears. The IMX began to rebound into the summer of 2020 as equity markets began to rebound after a slight uptick in economic activity. Market volatility continued into the fall of 2020 before markets headed higher, reaching all-time highs. TD Ameritrade clients increased equity market exposure to the highest level in nearly three years to end 2020. The upward trend continued into 2021 along with equity markets, and the IMX increased above 8.0 for the first time since 2017.
Disclosure:
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.
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.
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.
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