Are everyday investors back in the market?
While mutual fund outflows are staggering, it could be that average investors are bypassing fund managers to buy individual stocks themselves.
Is the retail investor back, or not? The other day I propounded the notion that quintessential retail stocks, such as Apple (AAPL), Panera Bread (PNRA) and Chipotle Mexican Grill (CMG) keep running and I have to believe it is because of individuals buying stocks.
But the mutual fund outflows were also pretty staggering -- about $2.8 billion in the data released Thursday. That would seem to indicate my thesis might be wrong. Plus, my friend Bob Pisani from the floor made it really clear that the low volume is further confirmation that there really isn't much retail investing to speak of.
But what if we are all right? What if individuals have stopped caring for mutual funds -- the love affair over because of poor performance -- and they have decided to concentrate on buying actual stocks? Is that so far-fetched?
I haven't seen any other explanation for what doesn't seem to me to be mutual fund buying. Take Apple. We know the mutual funds are underinvested in the name. We have had exhaustive studies on the issue. Doesn't that mean individuals are buying the stock? Doesn't that mean people think they can do better than the managers themselves (which is something I wholeheartedly agree with)?
I think that stocks may be a shrinking asset class, but that individual stocks are actually being bought if the story is good and the product or service is loved.
Yep, this is an "out there" thesis, but unless someone has a better one, it's mine and I am sticking with it.
Related Articles
Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long AAPL.
The true facts are the Feds BEN devaluing the US dollar! The US congress is the best MONEY CAN BUY !
Well at least you made one honest statement only you failed to mention Obama is controlling them. Get rid of Obama and watch the economy improve! As a bonus we get some of our Freedom back he has taken!I'm an everyday investor and i'm on the sidelines for a long time now since 2004 and made a lot money in the bond market. the market is a giant ponsi scheme????
wait till the next international event happens all the investors will be running for the exits big time have your stop losses ready!!!!
I don't know what you are talking about - Obama is the Bail Out King of all History! Besides - If you are so down on stocks why are you posting here? Maybe you are a Political Hack!
Im just a person who can see through the FEDs BS ! Wall street is a joke ! Once more i guess the Savings and loan fiasco in the late 80S and early 90s does not ring a bell ? That was daddy Bush ! NAFTA from Clinton did more to kill jobs than the BUSH tax cuts ! Congress is bought and paid for by wall street! So once mor devaluing the US diollar with printing money is good from the FEDs ! NOT Obama ! The President controls gas prices as much as YOU DO ! I guess if people are told enough BS they start believing it ! so can you name any Jobs created by any tax cuts ? The feds do control the printing presses ? TWO unpaid for wars at the cost of 2 BILLION a week ? for over 10 yrs ? Can you add ? The value of our homes is about ZERO . The Market is saturated with no end in sight ! No im no hack , just an American that knows the real truth ! Im part if the land of the free! Not the home of the stupid like some people ! Feel free to point out anything i have said that is NOT TRUE. Besides your political BS.
The investing public is sick of poor fund returns and duplicitous Wall Street shenanigans that take and don't give back.
I consolidated all my tech holdings into AAPL last year but may consider HPQ too if it shows strength. Others are all divvy stocks of companies providing fundamental, necessary services. No funds at all, as they are just like the guys who used to care for my yard......they did a good job the first time, then it was all 15 minutes of blow and go from there. Fired them in 2 months. That's Wall Street today........a quick blow and go, and define that any way you want to and it still fits perfectly.
The republicans love big government as long as the US treasury bailout all the big banks out like they have and did ! This is NOT capitalism ! Now back in 08 the banks should have been left to fail because of THEIR SHADY mortgage practice ! Most mortgages at that time had PMI insurance because once more the banks lost their sound lending practices by requiring 20% down
I don't know what you are talking about - Obama is the Bail Out King of all History! Besides - If you are so down on stocks why are you posting here? Maybe you are a Political Hack!
Cramer is right on - I dumped Brokers and Mutual Funds for Individual Stocks - Best decision I ever made regarding my Investments!
@ user903960: You idiot, Obama is the bail-out king only because it fell to him after Cheney/Bush totally screwed things up, so Obama was elected, and had to finish the job they started. You should stop watching Fox News, dude. It's just a running commercial for the anti-Obama crowd. He's not perfect, but he's done a lot of good things.
He's (Obama) is a Communist by any definition. Man all the Acorn Political Hacks are out in force today! By Far Obama is the worst president in our History!Well at least you made one honest statement only you failed to mention Obama is controlling them. Get rid of Obama and watch the economy improve! As a bonus we get some of our Freedom back he has taken!
LOL With all due respect i think you need a civics class ! The congress by the constitution has the check book and laws in our system of government ! The President has the armed forces! You seem to be confused ? I guess you are a Rush Limbaugh clone! Lets see ? Rush ? Never served in the US military ? Never went to collage ? 4-F from NAM for a boil on his butt ! Never elected to any office ? Never ran a company? The republicans hero ! LOL The President does not have the power to line item VETO! He must ok it with it all ? from congress or reject it ALL ! The whole thing ! Another thing the republicans control the house . RIGHT? So they control how long the house works , the bills that reach the floor for a vote , all the bills that are in play by any member they control what gets tabled and what goes to the floor for a VOTE. So i think you better google the US constitution and read it! 9/11 was a sad day for America !!!! But it did not have to cost 5 trillion dollars for two wars unpaid for ,and the TSA and the ports and the patriot ACT done by BUSH and a REPUBLICAN HOUSE ! That what has taken your rights you idiot BTW CAN YOU READ??? and the people who are fighting for what in AFG? It sure is not the US constitution ! NAM showed us that if you do not win the people you do not win at all !!! History shows where we have failed every time ! You call Obama a communist ? LOL The Communist Chinese and North Koreans are the communist ? BTW President Obama got BIN LADEN DEAD . So much for your garbage and lack of education in civics!!! LOL America Land of the free? Home of the Stupid like you ! OH one more thing on HISTORY , the Japanese sunk 90% of our Pacific Fleet in 1941 but yet today i cannot turn a corner without seeing a TOYOTA or a HONDA LOL So much for 9/11 ????? Think about that ! I love my country did 4 yrs in the U.S.M.C. but the way congress runs ? Its a joke ! Take that civics class you fool ! But then i bet you DRIVE A TOYOTA LOL LOL LOL ... Only in the USA baby where idiots like you are free to be idiots! LOL
MORE ON MSN MONEY
DATA PROVIDERS
Copyright © 2013 Microsoft. All rights reserved.
Quotes are real-time for NASDAQ, NYSE and AMEX. See delay times for other exchanges.
Fundamental company data and historical chart data provided by Thomson Reuters (click for restrictions). Real-time quotes provided by BATS Exchange. Real-time index quotes and delayed quotes supplied by Interactive Data Real-Time Services. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by SIX Financial Information.
Japanese stock price data provided by Nomura Research Institute Ltd.; quotes delayed 20 minutes. Canadian fund data provided by CANNEX Financial Exchanges Ltd.
STOCK SCOUTER
StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.
126 | 258 | 459 | 600 | 671 | 683 | 603 | 455 | 270 | 113 |
| 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 |
LATEST POSTS
Try as the bears might, they couldn't break US stocks. But investors still face frothy prices and considerable headwinds.
FIDELITY VIEWPOINTS
- How to sell covered calls - Fidelity Investments
- Savvy year-end tax moves to consider now - Fidelity Investments
- Seven ways to prepare for tax changes
- Five reasons an annual review is crucial - Fidelity Investments
- Take a look at mid caps now - Fidelity Investments
- State of the sector: Health care - Fidelity Investments
VIDEO ON MSN MONEY
ABOUT
Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.
Contributors include professional investors and journalists affiliated with MSN Money.
Follow us on Twitter @topstocksmsn.