TD Ameritrade's Investor Movement Index: After Hitting a Two-Year Low, IMX Takes a Positive Turn

TD Ameritrade, Inc. (“TD Ameritrade”), a broker-dealer subsidiary of TD Ameritrade Holding Corporation (NYSE: AMTD), is today releasing the Investor Movement Index® reading for March 2015. The Investor Movement Index, or the IMXsm, is a proprietary, behavior-based index created by TD Ameritrade that aggregates Main Street investor positions and activity to measure what investors are actually doing and how they are positioned in the markets.

The March 2015 Investor Movement Index for the four weeks ending March 27, 2015, reveals:

• Reading: 4.75 (compared to 4.70 in February)
• Trend direction: Positive
• Trend length: 1 month
• Score relative to historic ranges: Middle

After hitting a 2-year low in February the IMX bounced slightly higher to 4.75 in March.

TD Ameritrade clients increased their exposure to equities moderately in March. The new two-year low in the IMX registered last month, and the lower exposure to equity markets it represents, appeared to have served clients well as U.S. equity market indexes saw mixed returns from week to week, with the S&P 500, Dow Jones Industrial Average and NASDAQ all ending the period between 2% and 3% lower than where they began. Volatility in the S&P 500 as measured by the VIX was at a year-to-date low to begin the March IMX period, and remained low relative to recent levels throughout the month. Both equity markets and Treasury bonds traded higher immediately following the Federal Reserve policy statement, which indicated that the timing of any rate increase would still be dependent upon the Fed’s economic goals – and that the country had not satisfied these goals yet. Crude oil prices also continued to play a role in the markets, as their levels declined through the first half of the month on concerns about U.S. storage capacities reaching their limits.

The modest increase in equity market exposure came during a month where TD Ameritrade clients were net buyers of equities in dollar terms. Despite this broad net buying activity, the IMX remained in the middle of its historical range. This was due in part to a reduction in volatility relative to the S&P 500 for some of the most widely held names, which helped moderate the rise in equity market exposure from the net buying activity.

“It is extremely rewarding for us to see our clients doing well and responding to market conditions,” said Nicole Sherrod, managing director of the trader group, TD Ameritrade. “Our client's sentiment dropped to a two year low at the conclusion of February and the S&P dropped by 2%. They appear only slightly more optimistic heading into April.”

Continued price pressure on oil producers and energy related stocks appeared to translate into buying opportunities for clients as Exxon Mobile Corp. (XOM), Chesapeake Energy Corp. (CHK) and SeaDrill Limited (SDRL) were all net buys and saw declines in their values over the period. Names making headlines were also popular buys. Apple Inc. (AAPL) announced a new product and an exclusive partnership with HBO and was a net buy. Lumber Liquidators Holdings, Inc. (LL) stock price plunged at the end of February and continued to trade lower in March, which seemed to prompt some clients to buy the stock.

March saw net selling in popular financial names such as Citigroup (C) and American International Group (AIG). Both companies had court settlements announced in March and had rebounded back to near levels of resistance after hitting year to date lows in late January. Well known dividend payers Ford Motor Co. (F) and McDonalds Inc. (MCD) saw year to date highs in March and were also net sells. Alibaba Group (BABA), which has declined in price since a disappointing earnings result in January, appeared to find a level of support and was net sold as well.

The IMX value is calculated based on a complex proprietary formula. Each month, TD Ameritrade pulls a sample from its client base of 6 million funded accounts that 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 December 2010, to view the full report from March 2015, 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 TD Ameritrade Mobile Trader platforms.

Inclusion of specific security names in this commentary does not constitute a recommendation from TD Ameritrade to buy, sell, or hold.

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.

For the latest TD Ameritrade news and information, follow the Company on Twitter, @TDAmeritradePR.

Source: TD Ameritrade Holding Corporation

About TD Ameritrade Holding Corporation
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