Institutions vs Retail Investors -- The "Long-Short Standoff" in US Stocks
The S&P 500 index has risen 14% since the intraday low on April 7, and the price-to-earnings ratio has now rebounded to over 20 times. The Mag-7 recorded its best weekly performance in three years (+9.4%). Institutions: The net leverage of U.S. fundamental long-short funds has significantly rebounded from an absolute low, but overall it remains at a low level (Figure 1). Retail investors: Retail investors in U.S. stocks continue to aggressively increase their holdings, especially in the Nasdaq (Figure 2)
The S&P 500 index has risen 14% since the intraday low on April 7, and the price-to-earnings ratio has now rebounded to over 20 times. The Mag-7 recorded its best weekly performance in three years (+9.4%).
Institutions: The net leverage ratio of U.S. fundamental long-short funds has significantly rebounded from an absolute low, but overall it remains at a low level (Figure 1).
Retail investors: Retail investors in the U.S. stock market continue to aggressively increase their holdings, especially in the Nasdaq (Figure 2).
