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I ran across a recent press release from Business Wire that announced some activity for Charles Schwab Corporation in July and August. I was encouraged by the large in-flow of new assets that came into Schwab in August of about $62B. A curious amount of trades were placed in July and August. Trades were up substantially 57% in the month of August alone and 35% in July. Now what reasonable explanation could justify this amount of rampant trading activity? Why is this happening? FEAR, FEAR, FEAR!
There's no reason for the market to have the volatility that it has, outside of the shroud of political uncertainty we Americans find ourselves. Companies are profitable, dividends are good, lots of cash sitting on the sidelines, until more clarity about the current state of government spending etc comes to light we will see a continuance of business as usual. The unintended consequence is people are squandering their retirement life savings away on trading and the fees that it creates. Charles Schwab is just one firm, think of the hundreds of other firms that are experiencing this kind of trading volume. It saddens me to see this amount of trading happen because it costs the American public billions of dollars when they should just stay with the well diversified portfolio, hold it and rebalance. Realize that investing is a long-term endeavor, this too shall pass. Check out the link to the Business wire article.
R. Paul NicholsFinancial Abundance, Inc.
(814) 867-5745 (814) 867-5747 Fax