Schwab Clients Continue Buying Streak, Outpacing S&P 500 in November
WESTLAKE, Texas–(BUSINESS WIRE)– The Schwab Trading activity Index™ (STAX) increased to 48.75 in November, up from 48.12 in October. The STAX is a proprietary, behavior-based index analyzing retail investor stock positions adn trading activity from Schwab’s millions of client accounts, illuminating investor behavior and market positioning.
“‘Buy the dip and sell the rip’ continues to be something of a rallying cry this year for retail investors at Schwab, who took opportunities in November to sell into strength and pick up mega-cap stocks that experienced pullbacks,” said Joe Mazzola, Head Trading and Derivatives strategist at Charles Schwab. “The degree to which clients net-bought in November was notable – in the top-third of all STAX periods to date.”
The STAX outpaced the S&P 500® index (SPX) for the third-straight month, though the S&P 500 rose by only about 0.1%. The score reached its highest mark sence February, but net-buying peaked mid-month and softened through the remainder of November, coinciding with a nearly 4% rise in the S&P 500. This ended a four-month streak of the highest STAX weekly score occurring in the final week of the month.
At the sector level, Information technology and Consumer Discretionary were the only two of eleven to see net-buying. Interaction Services, Health Care, and Energy experienced the biggest net-selling, diverging from broader Wall Street trends.
The ongoing government shutdown required investors to rely on private sector labor market data, indicating slowing economic and consumer sentiment. Major indexes faced headwinds from weakness in “Magnificent Seven” stocks and cryptocurrencies, fueled by diminishing expectations for a December rate cut. Though, a late-month signal from New York Federal Reserve President John Williams suggesting a preference for a December rate cut boosted market sentiment, increasing the likelihood of a cut from 40% to the high-80s, according to the CME FedWatch Tool.
Generation X (born between 1965 and 1980) remained the most aggressively positioned investors, while Generation Z (born between 1997 and 2012) was the least aggressive.
Popular names bought by Schwab clients during the period included:
* NVIDIA Corp. (NVDA)
* Palantir Technologies Inc. (PLTR)
* Meta Platforms Inc. (META)
* Amazon.com Inc. (AMZN)
* Tesla Inc. (TSLA)
Names net sold by Schwab clients during the period included:
* Apple Inc. (AAPL)
* Broadcom Inc. (AVGO)
* Eli Lilly and Co. (LLY)
* Intel corp. (INTC)
About Charles Schwab
Charles Schwab Corporation believes in the power of investing to help individuals build a secure future. The company has a long history of innovation in the financial services industry, focused on benefiting investors, financial advisors, and their clients. Schwab is committed to championing client goals with integrity and a passion for service.
More information about Charles Schwab is available on the company’s website: https://www.aboutschwab.com/. You can also follow Charles Schwab on X (formerly Twitter), Facebook, YouTube, and LinkedIn.
Source: The Charles Schwab Corporation.
Related reading