Some fascinating data from Nick Colas and company (Convergex) looking at how little the average American cares about what goes on in the financial markets these days. Tough to look at this and conclude we have a real bubble, given the utter apathy…
Despite the elevated level of volatility in the capital markets since August, the average American investor remains unfazed. Search items in our financial assets category (Stocks, bonds, and ETFs, for example) edged up 2% since July. Rapid drops in stocks typically spur retail investors to panic and contact their money manager out of concern. While “financial advisor” (-3%) peaked in August, searches for “stockbroker” declined 6% over the past three months and 44% since December. Similarly, searches for financial services firms fell: “Vanguard” (-8%), “Schwab” (-12%), and “E-Trade” (-17%). Although Wall Street’s suffered a couple of rough months in the marketplace, it didn’t necessarily spook a particularly high number of retail investors enough to log into their accounts and sell positions in their portfolios for fear of further losses.
Overall, interest in various financial assets was a wash over the quarter. While “corporate bond” (34%), “stock market” (+10%), and “large cap stock” (+7%) were up, for example, “high yield bond” (-2%), “mutual fund” (-5%) and “ETF” (-15%) were down. Popular stock or ETF symbols followed the same mixed pattern: “CVX” (+3%) and “GOOG” (+8%) rose, while “EEM” (-12%), and “JPM” (-11%) fell.
People were also less interested in non-traditional investments (House flipping, venture capital, and silver coin, for example). This category dropped 7% over the past three months. Everything from real estate (-16%), buy art (-3%), and diamond (-9%) to private equity (-3%), gold coin (-23%), and retirement fund (-10%) were down.
Josh here – wow.
Market strategists at Convergex, a global brokerage company based in New York.