"Skipping The Dips, Selling Into Rallies": Retail Is Selling Stocks At An Alarming Pace

In a time when both institutions and retail investors have  not been buying the dip, last Wednesday's bounce provided partial relief in an otherwise negative week for retail investors, confirming the patterns we observed over the past 2 weeks: retail investors skipping the dips, selling into rallies, and positioning more defensively.

According to the latest JPMorgan retail radar note (available here), total purchases in March finished nearly 50% below the levels seen in the record January. Through last Tuesday, retail investors continued to post moderate inflows into ETFs while net selling single stocks, even as markets rebounded. On Wednesday, as market strength persisted, retail flows - while healthy (76.6%ile, driven by ETFs at 96.4%ile) - continued to signal caution: ETF inflows were strong, but in reality the incremental buying that took place skewed toward Fixed Income ETFs (98%ile, driven by SGOV, 5.5z), rather than “risk-on” exposures.