A recent Bloomberg article claims that individual investors are making professional traders “nervous” this year.
“Small investors’ recent interest in stock picking stands in contrast to the long-term trend in a bull market that’s more than nine years old,” the article says, adding that professional traders are “trying to make sense of a market that’s psychologically edgy.” Among traders, it explains, the adage to “buy the dip” has flipped into using any rise in the market “to take some money off the table, before it drops again.”
Since March, the article reports, the S&P 500 has fallen in the afternoon more than half the time. Now, it adds, stocks are about where they were at the start of the year, “despite one of the best earnings seasons ever.”
The article concludes by pointing out that turbulence is nothing new to investors and, since the bull market began nine years ago, there have been at least five corrections. “But not,” it notes, “when things were going so well in earnings and the economy.”