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Schwab clients were net buyers of equities in November, continuing three-month streak of outpacing the S&P 500® index (SPX)
The Schwab Trading Activity Index™ (STAX) increased to 48.75 in November, up from its score of 48.12 in October. The only index of its kind, the STAX is a proprietary, behavior-based index that analyzes retail investor stock positions and trading activity from Schwab's millions of client accounts to illuminate what investors were actually doing and how they were positioned in the markets each month.
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�'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 significant 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 notably the S&P 500 rose by only about 0.1%. The score hit its highest mark since February of this year, but net-buying peaked around mid-month and fell the rest of the way, posting its softest reading in the final week of November when the S&P 500 index rose nearly 4%. That downward trend for STAX in late November ended a four-month streak in which the highest STAX weekly score occurred in the final week.
At the sector level, only two of the eleven saw net-buying from Schwab clients during November: Information Technology and Consumer Discretionary. The biggest net-sell sectors were Communication Services, Health Care, and Energy, bucking Wall Street trends.
The government shutdown that began in October and continued into November meant investors had to rely on private sector labor market data, all of which showed slowing economic and consumer sentiment. Major indexes spent much of November losing ground amid weakness in Magnificent Seven names and cryptocurrencies, hurt partly by falling hopes for a December rate cut by the Federal Reserve. However, the market got a significant boost toward the end of the month when New York Federal Reserve President John Williams signaled a preference for a rate cut in December, bringing the likelihood of a cut from a low of 40% into the high-80s according to the CME FedWatch Tool.
As in October, the most aggressively positioned investors tracked by Schwab during November again belonged to Generation X, born between 1965 and 1980. Among the least aggressive was Generation Z, born between 1997 and 2012.
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)
- Rivian Automotive Inc. (RIVN)
About the STAX
The STAX value is calculated based on a complex proprietary formula. Each month, Schwab pulls a sample from its client base of millions of funded accounts, which includes 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 STAX.
For more information on the Schwab Trading Activity Index, please visit www.schwab.com/investment-research/stax . Additionally, Schwab clients can chart the STAX using the symbol $STAX in either the thinkorswim ® or thinkorswim Mobile platforms.
Investing involves risk, including loss of principal. Past performance is no guarantee of future results.
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.
The STAX is not a tradable index. The STAX should not be used as an indicator or predictor of future client trading volume or financial performance for Schwab.
About Charles Schwab
At Charles Schwab, we believe in the power of investing to help individuals create a better tomorrow. We have a history of challenging the status quo in our industry, innovating in ways that benefit investors and the advisors and employers who serve them, and championing our clients' goals with passion and integrity.
More information is available at aboutschwab.com . Follow us on X , Facebook , YouTube , and LinkedIn .
1225-H6NX
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At the Company
Margaret Farrell
Director, Corporate Communications
(203) 434-2240
margaret.farrell@schwab.com
