This page has been archived and commenting is disabled.
US Long-Only Funds Selling Surges To Level Last Seen In Days Following Lehman Collapse
The latest confirmation that there is nobody left in stocks save for hedge funds, HFTs (who do so at a comped exchange loss via liquidity rebates), and primary dealers, comes courtesy of UBS Client Flow research, which reports that "long only funds increased their net selling to levels last seen in October 2008." Putting a number to this: the week outflows by long-only funds was $783 million in the week ended October 1. This is in addition to observations that retail flows are now a one way street away from stocks, and merely reinforces the threat that the hedge fund playground which is what the stock market is now exclusively, could plunge the moment there is coordinated selling and profit taking. To use more graphic terms, the entire theater is just full of hedge fund millionaires, where everyone owns the same stock (mostly Apple), there is only one open door, and the Fed keeps on pouring gasoline all over the place.
From UBS:
US clients increased their net selling of US equities since the prior four-week period. Most of the increased net selling came from long only funds; this is the most net selling we’ve seen from US long only funds since October 2008. At the same time, hedge funds and corporate clients also decreased their net buying. On a sector level, cyclical sectors all saw increased net selling. Materials and consumer both went from being net bought to net sold.
And here are the charts you will never see on CNBC:
And in tabular form:
You read that right: the 4 week outflows from Long Only Funds is now nearly $800 million, while total UBS clients have withdrawn nearly half a trillion in capial.
More relevantly, in the week ended October 8, nobody bought anything!
US Client Flow: Long only funds increase net selling
US clients continued to be net sellers of US equities for a second week. Long only funds increased their net selling to levels last seen in October 2008. The only net buyers were hedge fund and corporate clients, which both decreased their net buying.
Sector details of US Client Flow: Increased net selling in most US sectors
US clients were net sellers of all US sectors except media, which saw decreased net buying. Both consumer and materials went from net bought to net sold in the most recent period. US financials and tech also saw substantial increases in net selling from US clients, led by US hedge funds. At the same time, US clients have decreased their net selling of foreign financials and tech.
Foreign Client Flow: Also net selling at October 2008 levels
Foreign clients increased their net selling of US equities to October 2008 levels, led by “other” clients, which include family offices, sovereign, and other uncategorized accounts. Only long only funds were net buyers. Nearly every sector saw increased net selling, even tech and media, which had been the only US sectors foreign clients were net buying in the prior four-week period.
And yet, the mockery of stock market was up.
So who is buying? Here are the sectors that hedge funds (the only entities actually putting money in stocks, and only to avoid redemptions) like and hate:
Still with the 4 week average hedge fund buying a speck compared to Long-Only outflows, one wonders where the balance (wink, HFT, Liberty 33, wink) is coming from...
»
- 10697 reads
- Printer-friendly version
- Send to friend
- advertisements -
Moin from Germany,
million not billion....
Ok, so retail investors continue to bail on the stock market. So what? Did it ever occur to you that the crowd is almost always wrong?
Did it ever occur to you that volume leads price? :D
"The latest confirmation that there is nobody left in stocks save for hedge funds, HFTs". Well hold on there... HFT own nothing at the end of each trading day and Hedge Funds collectively have AUM of under $2 trillion. Capitalization of US Stock market somewhere around $40 trillion, so it seems somebody still owns stocks besides the hedge funds.
I know who's buying. It's got to be Barton Biggs. Who else would do this. About 6 weeks back he was on CNBC and said he sold almost everything. Then uncle Ben called him and said buy. I got your back. So he showed up just two days later and said he is buying and was bullish as ever. Have not heard from him since. So who would have our backs. YUP, its got to be good ole Barton.
Is this the seen in that movie where they dig the dead pilots out of the snow and start cutting off strips?
Who plays the Snow creatures?
I must admit that is tempting to own a few equities as further QE floods the market. But, sheesh, at some point the market is doomed to fail in spectacular fashion.
At least in Vegas or some other casino, you have about a 55/45 risk/reward ratio. In the "stock market" it seems about 90/10 at this point. Therefore, no thanks. I'll just hold my gold, silver and soybeans and wait.
Heh, I heard this morning that King Pharma was being bought out by Pfizer and realized that I had some stock certificates that my father had given me years ago. I had forgotten all about them until I heard that. I'll have to send them in to my broker and cash in on the good news. Buy some more silver.
Turd,
ad some canned stuff, water and ammo! And NO, no more buying of "undervalued" stocks, and "overvalued" bonds, hehehe! All Hell will brake loos and will push it ALL down, including gold, silver and the like, then we'll ad some more of that shiny metal, guns, ammo...you get my direction!
Wow.
28 weeks in a row of constant selling.
Why is that?
Because "investors" would rather tie up their money loaning 10-year money to Uncle Gorilla at a paltry 2.6% a year.
With no upside in the income stream.
And no upside in the principal amount invested.
If they were smart, there are over 50 stocks in the S & P 500 paying over 4%, and probably 2/3rds of those companies will raise their dividend each year for the next 10 years....
Example: Nucor now pays a dividend of 3.8%, and has paid dividends every year for 37 years, and is currently a stock in the worst performing sector of the S & P 500 the last 12 months. And a cyclical industry to boot...
And it is still a better option than buying gold that pays zero, or locking up your money in Treasuries that pay next to nothing.
You "always sunny" real estate agents aren't accounting for the fact that stocks that pay dividends CAN go down for various reasons.. y'know.. lower profits, dilution, HFT computers shuttin' down, Ben pissing in the US stock market, etc..
Gold is still better than stocks.. It sure pays more than 3.8% or whatever dividend rate you want to quote.
Deliver.
To Whom, Exactly, Have You 'Ceded' Your Stocks?
What we have now suddenly all come to find out is the Cede & Co is actually not a fictitious name, but a subsidiary company of DTCC. In essence, DTCC owns probably 99% of all the stocks in the entire world. This is how it works. You buy some shares of stock at your brokerage. Your broker tells you that, in order to do business on your behalf, you must give the brokerage power of attorney to buy and sell.
Therefore, your stock purchases are placed in a "street name" because, according to the SEC, no brokerage can place a stock in its own name. The brokerage then notifies the DTCC of the transaction. The DTCC is a banking trust company and, by SEC regulation, cannot own shares in its own name, either. So it transfers the certificates to its subsidiary, Cede & Co.
What do you own? How about nothing?
Take delivery since Equity did survive then. The point of older investors is just that if the ship goes down it will not matter since Congress has been removed from the Constitution if you admit it or not. We wish Congress to serve the letter Born in Blood. Zirp is killing the Elderly on issue we all seen coming. Think about that.... Whom do they serve...
Nucor, yeah, that flash crash last week doesn't inspire me to risk money on that pos.
Can you please explain how Nucor, with a P/E of 84 and in an industry full of excess capacity, can possibly be a buy? The dividend yield doesn't mean squat when the stock is teetering on the edge. No way.
Look at American Express (AXP), with a P/E of 15 and having just gone through a lawsuit-driven beatdown in share price. The dividend of 1.9% doesn't compare with Nucor, agree, but at this price it's like getting a free put with every share.
i junked you because you either fail to see what all of us see or you atr like Leo , a shill for the government and market.
Cnt you see that it will ALL stop? We are weimar,zimbabwe and argentina and then some. Wake the fuck up Robonut
...RobotTrader, someday when you come to clean my house I will pay you in a bit of silver. then you'll know what it is worth. ha, ha!
Just when I thought you could not write anything more absurd than some of your previous commentary then you create this one:
"Example: Nucor now pays a dividend of 3.8%, and has paid dividends every year for 37 years, and is currently a stock in the worst performing sector of the S & P 500 the last 12 months. And a cyclical industry to boot..."
As we all know since something has happened every year for 37 years it must continue for the next 37 right? Besides, who cares about loss of capital as long as you can continue to collect that great dividend.
That is one big LOL.
Great example - Nucor Steel Sept 14 flash crash:
The 30 year seems fairly priced if you assume that inflation will be 1% for the next 30 years. And the Fed is currently making noises about moving the target inflation rate up to 4%. Who is buying these things?
Stocks seem to be a better bet than bonds. But with stocks you have the issues of corrupt accountants, so you cannot be sure how much money the company is really making. And the SEC is useless, so outright fraud is also a possibility (e.g. Crazy Eddie). Plus management has strong incentives to goose the earnings for a few years in order to collect huge bonuses, leaving a worthless husk of a company (look at Enron, Worldcom, Countrywide, WaMu, Lehman, etc.). Probably there are stocks out there which are very good buys, but how to identify them?
PM's should appreciate at the inflation rate on average. So if you assume a 3% inflation rate on average, then PM's should "pay" that much over the long term, with no default or counterparty risk if you hold them yourself. With all of the debt that governments are currently accumulating, I expect the inflation to go much higher than 3% eventually.
Yeah. I owned Pfizer stock when the dividend was running close to 8%. I hung in there because I thought that was like using the stock as a bond. It is the only reason I held the stock because I expected no price appreciation. Then the bastards cut the dividend in half and the stock tanked to about $11. So, I lost on the price depreciation and the dividend that kept the value up. It hovers in the teens, now. The problem is that dividends can get cut and in a plunging stock market the price looks good as a percentage. However, if you bought the stock relatively high the (taxable) dividend looks very different compared to the money you put in.
Would the new owners of stock not start showing up on company registers and substantial owner notices?
Or are these dark pools?
It's over people....go home.
http://www.youtube.com/watch?v=1-Sgvq98mjc
The Main Event.
..."and the Fed keeps on pouring gasoline all over the place".
I've got matches, a lighter, and can rub two sticks together to get a spark. Now where can I put it?
More Eagles on their way home.
The shit storm is upon us. I can smell it everywhere
Agree, but the thinking process is pecentages only.
The only thing I want to buy now is a ticket for a seat, so I can watch what happens when this den of thieves has no true investors left to rob.
At least they've been able to sell at good prices since the fed and HFTs keep ramping every single itty bitty pull back.
Someone please give me the deffinition of "Long only"
2 milliseconds
In the rare instances when an executing broker demurs, he sends the trade to a dark pool, usually one owned by his firm. (Dark pools are electronic-trading venues where institutional investors trade stocks away from the public stock exchanges.) If the dark pool can't execute the trade, it is sent to one of the stock exchanges. This largely automated process occurs in sub-seconds.
On May 6 when the market fell out of bed, the report says blandly, some of these players reduced executions of sell orders but continued to execute buy orders. In other words, they'd sell stock to a retail customer but wouldn't buy stock from a retail customer. They wanted to get rid of their own inventories, not accumulate more shares. So they sent the customer sell orders onto the swamped stock exchanges.
WSJ http://finance.yahoo.com/banking-budgeting/article/110989/the-real-flash-crash-culprits?mod=bb-budgeting
Some shares are traded, some are bought. Trade as in buy in the morning and sell in the afternoon. Bought "long" means you intend to hold for a period of time.
when the markets are controlled by "an official entity"
then freedom is just an illusion
we passed that point
and now we're fucked
the whole of it is a rotten farce
It's nice that TPTB keep holding up the markets so the really slow thinking public has all the time it needs to head to the exits in an orderly manner.
OK, it's not clear --- and this is very important --- whether this statistic is for mutual funds only or includes ETFs. If the outflow is just for mutual funds, then Occam's Aftershave sez: folk are simply moving into ETFs.
-test-