TD Ameritrade Investors Scooped Up Facebook, Tesla in September

Election and rate hike concerns did not stop retail investors from stepping up their equity exposure in September, especially in popular stocks like Facebook and Tesla.

Author:: Gregg Greenberg
Publish date:: Oct 10, 2016 4:21 PM EDT

Election and rate hike concerns did not stop retail investors from stepping up their equity exposure in September, especially in popular stocks like Facebook (FB) - Get Report and Tesla (TSLA) - Get Report .

The behavior-based TD Ameritrade (AMTD) - Get Report Investor Movement Index (IMX), which aggregates Main Street investor positions, rose 4.4% to 5.49 in September as retail investors increased their exposure to the U.S. equity markets for the second month in a row. The S&P 500 was relatively flat in September, while the VIX, or so-called fear index, remained low except for a mid-month spike.

"The IMX soared to its highest point in two years at a time when the major equity markets were at or near their all-time highs as well," said JJ Kinahan, chief strategist at TD Ameritrade. "As earnings season gets underway in earnest this month, and the election looms, it will be interesting to watch whether clients change up some of their investment decisions after a couple months of volatility being quiet."

Each month, TD Ameritrade pulls a sample from its client base of 6 million funded accounts that includes all accounts that completed a trade in the past month. The holdings and positions of this statistically significant sample are evaluated to calculate individual scores, and the median of those scores represents the monthly IMX.

Among the stocks being purchased were dividend-payers Verizon Communications (VZ) - Get Report and AT&T (T) - Get Report . Both telecoms yield more than 4% and have seen downward pressure since setting new highs in July. Another stock picked up by investors was tech sector favorite Facebook, which set another all-time high early in the month.

TD Ameritrade said clients also picked up shares in companies that have seen recent declines including Tesla Motors, Bristol-Myers Squibb (BMY) - Get Report and Frontier Communications Corp. (FTR) - Get Report .

On the flip side, TD Ameritrade clients unloaded some popular and widely held names in September, such as Apple (AAPL) - Get Report which saw gains during the period surrounding the announcement of its new model of phones. Netflix (NFLX) - Get Report was also net sold as were Alibaba (BABA) - Get Report and Intel (INTC) - Get Report .