This page has been archived and commenting is disabled.
"Total Capitulation" - Biggest Weekly Equity Outflow On Record
If anyone was curious why the Fear and Greed index is at 13 (up from 5) despite the biggest 2-day surge in the Dow Jones ever, the answer is very simple: nobody believes the "broken market "any more, as confirmed by the biggest weekly equity outflow on record.
The full details courtesy of Bank of America:
Record Equity Outflows: weekly flows show $29.5bn outflows from equity funds (largest outflows on record – data since 2002)
- Equities: $29.5bn outflows (largest on record in absolute terms) ($6bn ETF outflows and $24bn mutual fund outflows)
- Bonds: $11.7bn outflows (largest since Jun’13)
- Money-markets: $22bn inflows (8w inflows of $121bn = largest since Dec’13)
- Precious Metals: $1.1bn inflows (largest since Jan’15)
The YTD verdict: equity inflows just $448MM YTD, compared to $97bn for bonds. Even commodities have a greater inflow compared to stocks, making one wonder who else is buying (we know it's not the smart money).
Geographic Breakdown:
- EM: $10.5bn outflows (largest outflows since Jan’08!)
- US: $12.3bn outflows (largest in 16 weeks)
- Europe: $3.6bn outflows (largest outflows since Oct’14) (first outflows in 15 weeks)
- Japan: bucks trend with $3.3bn inflows (inflows in 25 out of past 27 weeks)
Investor Capitulation: daily flows show massive $19bn redemptions from equity funds on Tuesday (8/25) = 2nd largest since 2007 (when daily EPFR data became available)
Credit exodus: $4.2bn outflows from EM debt funds; $4.9bn outflows from HY bond funds; $3.8bn outflows from IG bond funds (largest combined outflows since Jun’13 “taper tantrum”)
Fixed Income Flows:
- $4.9bn outflows from HY bond funds (largest outflows in 2015)
- $4.2bn outflows from EM debt funds (largest since Jun’13 “taper tantrum”)
- $3.8bn outflows from IG bond funds (largest since Jun’13 “taper tantrum”)
- $0.8bn outflows from bank loans (4 straight weeks) (largest outflows since Jan’15)
- $1.7bn inflows to govt/tsy funds (8 straight weeks)
Bull & Bear Index: falls to extreme “fear” territory of 0.5 (scale of 0-10)…most bearish since Jan’12 (Chart 2)
»
- 22154 reads
- Printer-friendly version
- Send to friend
- advertisements -
Tyler, you called that Total Capitulation??? I called that the Shortest Capitulation!
That's what Bank of America called it
All the negative articles and our own fears call for contrarian investing, but it's very hard to do.
Good luck with that.
MDB is that you?
How much billions did the Fed add to the markets through its unofficial arm, Citadel?
You would have to call 1-800-BERNANK.
Lets face it- retail investors don't have a clue what they're doing. They never have. This whole market would work so much better if we simply didn't allow individuals to participate. Institutional investors only from here out. Who's with me?
That's fine as long as you buy me lunch every day. That's the only way I'll be able to eat.
+1
Decades ago I was under the impression stocks were an 'investment' with some risk attahed depending on a corporation's performance. The corporation sold stock to raise capital, the investor recieves shares and if things went well the invester had equity and a dividend. In my mind, in those days it paid to be able to read balance sheets and P&L as well as being familiar with the market the corporation was in.
To me the aforementioned makes sense and is sound as it could be.
Today the whole concept is on its ass. Financial instruments no one understands are common. Financial reports cannot be trusted as being close to accurate, the whores are pimping everything they can and there are more hands touching and grabbing every transaction than ever before.
What I just wrote is what is wrong with the 'stock' market and those who control the system will never let it be what it should be in principle as the gambling aspect is too tempting, just like those high heeled jezebels giving free drinks near the one armed bandits in vegas.
@cherry - Look at those negatives from MSNBC. I think you hurt their feelings...
One of the big problems is the small investor is automatically disadvantaged. I called trades pretty good, but if you execute your plan, the numbers can change in a heartbeat. Instead of catching a low, you catch the rebound at the 90% mark. Then you say screw this, and figure, I'll sell and make a little anyway. Then the next day your number goes negative, and you're out 1% when the trade goes through. Then repeat. This where the HFT is killing real participation. I wouldn't be surprised if they lump up the small investor trades and dump them at the right time so the HFT's are sure to make money. The whole thing is rotten fish.
+1 for the sarcasm NoDebt.
If people want to blow their money, then they may.
My problem is with people blowing other people's money, namely, mine, through ZIRP, QE, TARP, etc.
NoDebt used sahcasm . . .
he used all da tricks, dwamatic iwahny, metahfoe, pathose, puns, pawohdy, litotes, ayperbole and satire
records are to be broken
The Muppets take Manhattan!!
(not)
I hope Yellen's and Henry's post-coital embrace is interrupted by a porcupine landing on them.
So if they are fear, who the F bought stocks the last two days to push 1000 point in the Dow? I guess they are happy now, everyone just buy the dips? can we check that meter again?
"...who the F bought stocks the last two days... Answer: "Somebody". Today, right now, a bit negative. Good time to be someplace else, I think.
So does that mean we are supposed to fight the fed now?
The great transfer of wealth from the Middle Class to the .001% continues.
Someone knows something. "Them them"
Say....hedge fund asshole...your house in the hamptons was on fire. Don't worry your home in Greenwich is flooded. You will rebuild, no worries. What is it like to be such a scumbag? Oh, right, it feels great! Read the instructions for the nail gun carefully.
I think the problem with these is we're not talking about long-term capitulation, we're talking about short-term capitulation. This is also probably a lagging indicator. Markets always fall faster than they rise, especially in a bear market environment, and this can cause fear and panic quickly. I don't see any sign that the mom and pop investors have checked out though. Most people are still dilligently putting money in their 401k or IRA, into some retirement-goal mutual fund. The long-term capitulation comes when those people wake up and get frightened, typically near the bottom of a long bear market.
You still don't own it if you cannot touch it, and defend it.
"A bird in the hand is worth two in the bush."
Some people remember 2008-2009, and/or they simply need the cash.
I await the day when the only player in the market is the Fed. The only activity is rights issuances which get gobbled up by more QE.
While everyone stands on the sidelines aghast....