Time to Worry: Investors Are Confident Again

At the end of last year, oil and the Russian ruble crashed, the VIX volatility index doubled, and U.S. stocks dropped 5 percent from their high — all circumstances that normally shake an investor's confidence. Not this time, though: New data from Fidelity shows that while the world panicked, many individual investors in the U.S. were buying stocks.

On one hand, this is good news: Buying during a pullback is generally a good strategy in a rising market. On the other hand, it's pretty unusual for individual investors to do what they're supposed to. Those kinds of good habits don't usually kick in until the market's climb has nearly run its course—which suggests that the good times may be drawing to an end. Doug Ramsey, chief investment officer of Leuthold Group, said in a recent note that investors don't usually retrain themselves to “buy the dips” until late in a bull market, and that's what's happening now: “Retail investors [are] finally shaking off the worry that gripped them.”