Reply #10: Main Street to Wall Street: We don't buy the rally [View All]

[ozymandius]

...After being key players in bull runs of the past, small-time investors have not only stopped buying, they're selling. The question for the new year: If the man on the street doesn't jump back in, will stocks continue to defy gravity?

So far, the market's comeback is almost entirely due to buying by professional investors at hedge funds, pension funds, banks and other institutions. ...

Mutual funds are a good proxy for such investors because more than three-quarters of fund assets are held by individuals, both directly and through retirement plans.
Small investors yanked a net $14 billion from stock mutual funds from the beginning of last year through mid-December. That's on top of a net $245 billion withdrawn in 2008, according to TrimTabs.

The firm says most of $592 billion taken out of money market mutual funds last year has gone into bond and bond-hybrid funds instead.

http://news.yahoo.com/s/ap/20100108/ap_on_bi_ge/us_shunning_stocks