Every year on June 20 or 21, the New York metro area and the surrounding environs (also known as the Northern Hemisphere) experience the longest day of the year, the summer solstice. This day has been celebrated for thousands of years by agrarian cultures and marketing departments who look for any reason to slap a sales sticker on a package.
Here at TABB Group we live up to a more noble cause: the resurrection of that former stronghold of U.S. investment dollars, U.S. equities. It has become painfully obvious that our industry can do itself no favors. We have a penchant for finding ever more creative ways to demonstrate our flaws to an increasingly bloodthirsty media and disillusioned public.
Despite the fact that the U.S. market has had relatively good performance compared with other equity markets, U.S. investors haven’t warmed up much more. I wonder if the folks who scheduled the June 20 Congressional hearing on Market Structure have a similar sensibility.
What a perfect day to shed light on industry practices.
The net flows within the U.S. domestic mutual fund industry are well-documented, so instead, I went to my friends at Lepere Analytics. As part of ongoing surveys related to their investment research product, they also collect information about the percentage of participants who own stock. According to the latest results, the percentage of U.S. investors who own stock has been stuck at about 66 for the last few years (see Exhibit 1). While that number may demonstrate that the U.S. equity markets are still far more diverse, in terms of discrete number of investors, than the over-the-counter derivatives market, it is still well off its highs.