Below is a graphic from TD Ameritrade that looks at retail client allocation changes within the S&P 500. What the green line shows is that individual investors sold out of the S&P 500, choosing to buy on less risky asset classes like core bonds.
This is just another reminder that attempting to time the market is very difficult. As we discussed this morning, tempering client fears makes it easier to keep individuals invested in the market. The turnaround between December and January is an example where one could have recouped much of their loss in a relatively short timeframe.
Peter Malone, CFA
Research Analyst
Direct: 617.226.0030
Fax: 617.523.8118
Crestwood Advisors
One Liberty Square
Suite 500
Boston, MA 02109