The Final Warning: Individual Investors Piling Into Stocks, Market Leverage Hits All Time Highs

Warning - Public Domain

Throughout history there have always been critical warning signs in the midst of financial exuberance that signaled the bursting of the bubble.

According to a report from Bloomberg the warning siren may have just gone off again.

Individuals Pile Into Stocks as Pros Say Bull Is Spent…

Main Street and Wall Street are moving in opposite directions.

Individual investors are plowing money back into the U.S. stock market just as professional strategists say gains for this year are over. About $100 billion has been added to equity mutual funds and exchange-traded funds in the past year, 10 times more than the previous 12 months…

“If Wall Street, after poring over all known data, comes up with a target and we’re already there, and you still see individual investors buying and they’re typically the ones that are late to the party, it would seem there is limited upside,”

“As institutional investors, we’re always concerned when the retail investor is actually arriving in the market,” Skiming, who helps manage $10 billion at Ashburton, said by telephone from Jersey, the Channel Islands. “The retail investor arrives when they can only see blue skies.”

But that’s not the worst of it.

(Read the rest of the story here…)

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