TD Ameritrade’s index of investor sentiment declined for the second straight month, the Omaha-based online stock brokerage said. Buying activity favored the Class B shares of Berkshire Hathaway Inc., among others.
Clients were net sellers of stocks and dialed back market exposure as the Standard & Poor’s 500 rallied to new highs, TD Ameritrade said in a statement.
The company said its Investor Movement Index fell to 5.02 in May from 5.31 in April. The index is created by analyzing and averaging the holdings, positions, trades and other data from TD Ameritrade’s 6 million customers. The information is then boiled down to an index; a rising index suggests bullish sentiment, a falling one bearish.
Even with two straight monthly declines, the May reading is “moderately high” compared with the index’s history of more than three years, TD Ameritrade said.
TD Ameritrade, employer of about 2,000 people in the metro area, makes money when brokerage customers trade stocks by collecting a fee on each one. The company also earns money from investing cash balances in customer accounts.
Shares of TD Ameritrade have risen about 43 percent so far in 2013. Shares of main rivals in the discount-brokerage industry have also risen so far this year, by about 40 percent at Charles Schwab and about 30 percent at ETrade Financial, amid renewed investor activity spurred by a surging stock market.
The Standard & Poor’s 500 has risen about 15 percent so far in 2013 and reached a record high, while the Dow Jones industrial average is up about 16 percent and this year closed above 15,000 for the first time.
TD Ameritrade said buying activity favored electric car maker Tesla Motors and the Class B shares of Berkshire Hathaway, the Omaha-based conglomerate whose holdings include The World-Herald. Net buying activity also was noted in Kinder Morgan Energy Partners, Amazon and Walt Disney.
Investors, TD Ameritrade said, lightened positions in Microsoft Corp., Cisco Systems and Intel Corp., each of which rose in April and May. Other selling happened with shares of Ford Motor Co., Sirius XM Radio, Citigroup and Bank of America.