The three
biggest U.S. discount brokerage firms said their stock trading volumes jumped
in February from a year earlier, an indication that confidence by small
investors in the stock market is continuing to gain after being fairly stagnant
in 2013.
Charles
Schwab Corp, TD Ameritrade
Holding, and E*Trade Financial Corp all had double-digit increases in February
compared with the same month in 2013.
Compared with
February 2013, average daily trades by Schwab investors last month gained 10
percent. At TD Ameritrade and E*Trade, February trading volume soared 30
percent and 32 percent, respectively, from a year earlier.
Institutional
investors monitor the ups and downs of trading volume by retail investors as a barometer of market
confidence.
All three firms have
signaled that small-investor confidence at the start of 2014 is strong after
many sat out 2013, when the Standard & Poor's 500 index gained about 30
percent. The S&P 500
was up 4 percent in February, bringing its gains for the first two months of
the year to 23 percent.
Schwab disclosed
another indicator of growing investor interest in stocks.
After a year in which brokerage firms of all types saw rising cash balances in
client accounts, Schwab clients poured a net $3.3 billion into stock and bond
mutual funds offered by the company while withdrawing $318.4 million from
money-market funds, which are nearly equivalent to cash.
For a second straight
month, international mutual funds attracted more money from Schwab clients -
$2.5 billion in January and February - than any other category. Taxable bond
funds were the second biggest gainers, with net inflows of $2.3 billion.