Shellshocked Investors Quit the Market
Could investors fleeing stocks become a lost generation?
By Adam Shell
NEW YORK — There are no visible picket signs on Wall Street. The U.S. stock market— the world’s biggest when measured by the market value of the companies that trade here — still opens for business every trading day. And the 6 o’clock news still lets everyone know if the Dow finishes the day up or down.
Yet, increasingly, investors on Main Street are not playing the stock market game with confidence like they used to, mainly because the game of making money has gotten tougher and more volatile since the financial crisis. Retail investors are buying fewer stocks. They are paring back on stocks and stock funds they already own. Instead, they’re moving into safer investments, like cash and bonds.
“Investors are on strike,” says Axel Merk, president and chief investment officer at Merk Mutual Funds.