IMX dips 8% in July as volatility among major names cools

The Investor Movement Index^® (IMX^SM) moved lower to 8.34 in July, down 8% from a record 9.08 in June. 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 July 2021 Investor Movement Index (Graphic: TD Ameritrade)

The reading for the five-week period ending July 30, 2021 ranks “High” compared to historic averages.

“Major indices hit record highs again in July and the vast majority of earnings reports to date have beaten expectations, calming some fears we had at the start of earnings season and adding some calm after the volatility we saw mid month,” said JJ Kinahan, chief market strategist, TD Ameritrade. “There are two major fears at the moment and that is the Delta variant spread worldwide and of course, the big wild card remains the Fed - its wait-for-the-numbers approach to monetary policy changes is adding uncertainty to the market.”

Equity markets moved higher during the period. All three major equity indices reached record levels, and the Dow Jones Industrial Average hit 35,000 for the first time. The S&P 500 had the best month, increasing 2.7%. The Dow Jones Industrial Average increased 1.5%, while the Nasdaq Composite moved higher by 2.2%. Markets shrugged off concerns of the ongoing COVID pandemic, which continued to cause economic worries as Delta variant cases surged during July. U.S. GDP growth reached an annualized rate of 6.5% in the second quarter, missing estimates of 8.5%, but the size of the economy now exceeds its prepandemic level. The Federal Reserve indicated that the economy has made progress toward its employment and inflation targets and hinted that it could begin to reduce monthly asset purchases later this year, while committing to continually assess progress in future meetings.

TD Ameritrade clients were net buyers overall during the July IMX period. Some of the popular equity names bought during the period were:

• Ford Motor Co. (F)
• DiDi Global Inc. (DIDI)
• Alibaba Group Holding Ltd. (BABA)
• Carnival Corp (CCL)
• Nvidia Corp. (NVDA)

TD Ameritrade clients took advantage of rising prices to sell some equities during the period, including:

• Apple Inc. (AAPL)
• Tesla Inc. (TSLA)
• Advanced Micro Devices Inc. (AMD)
• Pfizer Inc. (PFE)
• Nokia Corp. (NOK)

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 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 July 2021; 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 self-directed investors and registered investment advisors. A leader in U.S. retail trading, we leverage the latest in cutting edge technologies and one-on-one client care to help our clients stay on top of market trends. Learn more by visiting www.amtd.com.

Brokerage services provided by TD Ameritrade, Inc., member FINRA (www.FINRA.org) / SIPC (www.SIPC.org), 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. © 2021 Charles Schwab & Co. Inc. All rights reserved.

Source: TD Ameritrade, Inc.

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