Clients were net buyers but returned to reducing exposure during the period as several catalysts pushed the markets into new lows

The Investor Movement Index^® (IMX^SM) decreased to 4.47 in September, down from 4.82 in August. 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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The reading for the four-week period ending September 30, 2022 ranks “Low” compared to historic averages.

“After bucking the trend and increasing exposure to the markets for the first time all year in August, TD Ameritrade clients once again lowered exposure in September,” said Shawn Cruz, head trading strategist, TD Ameritrade. “From the Fed’s commitment to a hawkish approach to fighting inflation, to historic swings in currency values, to mixed jobs data and crude oil taking a nosedive, retail traders understandably took a risk-off approach in September, leaning into fixed income and investing in names built on solid fundamentals.”

Several macroeconomic catalysts drove increased market volatility in September as the S&P 500 retreated 11.63% to a new year-to-date (YTD) low. While the jobs growth figure reported by the Bureau of Labor Statistics at the beginning of the month was in-line with street estimates, the report also showed that the unemployment rate had upticked slightly. Despite this, the Federal Open Market Committee (FOMC) continued down its path of monetary tightening and increased the Federal Funds Rate by another 75 basis points. Federal Reserve Chairman Jerome Powell delivered firm commentary hardening the Fed’s commitment to tackling inflation after a Consumer Price Index (CPI) that showed a more persistent, and hotter than expected, core inflation rate. This led the CBOE Market Volatility Index (VIX) to push back above 30, a threshold historically associated with high volatility, late in the period.

Additionally, there was immense volatility in the US Treasury markets as 10-year yields spiked to levels not seen in over a decade and crude oil plummeted as demand concerns sent the commodity spiraling down over 14% during the period. Yet another catalyst was currency volatility as the US Dollar (USD) continued to climb in contrast to European currencies in particular. The British pound sterling (GBP) briefly traded near parity with the USD after the Bank of England’s emergency intervention to relaunch its bond purchasing program, and the Euro (EUR) also struggled, spending much of the period below parity with the USD as soaring energy prices continued to rock the eurozone.

TD Ameritrade clients were net buyers of equities overall, seeing the drop in market prices as an opportunity to increase exposure in some individual names. Some of the popular equity names bought during the period were:

• NVIDIA Corp. (NVDA)
• Intel Corp. (INTC)
• Advanced Micro Devices Inc. (AMD)
• Apple Inc. (AAPL)
• AT&T Inc. (T)

Names sold during the period included:

• Netflix Inc. (NFLX)
• Exxon Mobil Corp. (XOM)
• BP plc (BP)
• Snap Inc. (SNAP)
• Roblox Corp. (RBLX)

Millennial Buys & Sells

TD Ameritrade Millennial clients reduced exposure during the September period, but they were net buyers of equities, mirroring the overall TD Ameritrade client population.

Both TD Ameritrade Millennial clients and the overall TD Ameritrade client population favored semiconductor giants Nvidia (NVDA), Intel (INTC), and Advanced Micro Devices (AMD) as the chips subsector underperformed the broad market as a whole.

Both TD Ameritrade Millennial clients and the overall TD Ameritrade client population were net sellers of Snap (SNAP) as the social media company cratered back near its year-to-date (YTD) lows, but TD Ameritrade Millennial clients diverged from the overall client population in net buying Meta Platforms (META), parent company of Facebook and Instagram, as it charted new YTD lows during the period. Netflix (NFLX) was a name sold by both populations amidst relative outperformance during the period, with optimism around its plans to launch an ad-supported version of its streaming service driving the stock price higher.

TD Ameritrade Millennial clients were net sellers of Bed Bath and Beyond (BBBY) as the “meme” stock fell out of favor during the period, losing almost half of its value amidst fundamental uncertainty and declining trading interest in the name. TD Ameritrade Millennial clients were net buyers of every S&P sector, but buying was particularly strong in the Communication Services and Information Technology sectors.

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 September 2022, 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.tdameritrade.com.

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