Schwab Trading Activity Index Rises Modestly in July as Clients Buy Dips | LeapRate
Charles Schwab revealed this week that its Schwab Trading Activity Index rose to 59.80 in July, up slightly from 59.12 in June, as clients remained net buyers and used late-month dips to add exposure across individual stocks, ETFs and options.
The index, known as STAX, is a proprietary behaviour-based measure that analyses retail investor positions and trading activity across Schwab’s millions of client accounts to show how investors were positioned in the markets each month.
“While major indices posted strong gains in July, those gains masked the fact that many individual stocks performed unevenly—while some stocks rose sharply, others struggled,” said Joe Mazzola, head trading and derivatives strategist at Charles Schwab.
He said clients were selective, buying stocks that had pulled back and taking profits in names that had already run up.
Schwab noted that economic data during the period was generally strong, particularly in employment and manufacturing, while inflation remained a concern. Federal Reserve policymakers kept rates paused at a range of 3.5% to 3.75% at their late July meeting, with three officials dissenting in favour of a hike.
In ETF and equity trading, clients were net buyers by a two-to-one ratio, while options activity skewed towards put selling, particularly in technology stocks and the chip and memory industries. The strongest buying interest came from Gen X clients and self-directed traders.
Popular names bought during the period included Space Exploration Technologies, Micron Technology, Intel, Oracle and Tesla, while clients net sold Apple, Advanced Micro Devices, Broadcom, PayPal and Adobe.
