Investors pulled almost $400 billion from U.S. equity mutual funds from 2009 through 2012 while moving more than $1 trillion into bonds, as the worst financial crisis since the Great Depression bolstered the attraction of assets perceived to be the safest. The pace of deposits with fixed-income managers has slowed this year to $18.4 billion a month, the least since 2008, data from Washington- based ICI show.
Individuals are buying and selling more stock. TD Ameritrade’s 417,000 average trades per day last month were 13 percent more than the year-earlier period, according to a June 6 release. At E*Trade, daily revenue-generating trades climbed 11 percent from May 2012, the company said at a conference on June 6. Schwab clients increased trading 3 percent in April, according to a May 14 release.
Earnings Estimates
While S&P 500 earnings are forecast to rise 6.6 percent this year and 11 percent in 2014, analysts are more bullish on Schwab. They predict profits at the broker will increase 10 percent in 2013 and 18 percent the next year, according to estimates compiled by Bloomberg.
E*Trade, which has advanced 31 percent, is projected to return to profit this year and increase per-share earnings by 24 percent in 2014. The growth forecast for banks in the S&P 500 falls to 6.2 percent this year and 5.6 percent next year.