Memories of Post-Covid Melt-Up Haunt Anyone Selling Stocks Now
- Hedge funds derisking at odds with relentless retail buying
- Small-fry investors win big after bottom fishing amid pandemic
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Institutional investors are offloading equities to retail buyers in a traumatized market. While similarities between now and the bottom of the coronavirus crash may end there, memories of how that episode played out are proving hard to shake.
Despite breakneck volatility and harrowing images of war, retail traders just plowed money into the equity market for a ninth straight week, according to Bank of America Corp. client data. That’s a stark contrast to the firm’s hedge fund clients, which last week sold $4 billion of stocks, the most on record. Same thing on Morgan Stanley’s trading desk, where professional speculators have been cutting equity exposure, alongside relentless buying from amateurs.