Margin debt used to buy stocks has plunged by $329 billion

One measure of stock market speculation among investors has plunged to levels not seen since the low of the dot-com bubble burst in 2002, according to a Friday note fromFINRA margin debt, which measures the amount of loans taken on by investors to buy stocks, has plunged by $329 billion since the October 2021 peak.

On a percentage basis, today's 35% decline in margin debt from the peak does not exceed the more than 50% declines seen in 2008 and 2001, but as a percentage of total market cap, it does.The extreme de-leveraging isn't a surprise to Lee given thatover the past 15 months, which is a sign that investors remain risk-averse following the steep decline they experienced in stocks.

And it's that de-levering by investors that could set the stock market up for a continued rally if a soft landing in the economy materializes, Lee said, as investors will have plenty of fire power between cash on the sidelines and the ability to increase their margin loans to buy stocks.

Australia Australia Latest News, Australia Australia Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Carl Icahn’s company’s stock falls another 8% as short seller Hindenburg says latest disclosures raise more questions about margin loansIcahn Enterprises LP’s stock fell another 8% premarket Thursday, after short seller Hindenburg Research issued another report on Carl Icahn’s investing arm,...
Source: MarketWatch - 🏆 3. / 97 Read more »

Icahn stock renews skid as Hindenburg says latest company disclosure raises more questions about company debt, lossesIcahn's partnership shares come under fresh pressure as Hindenburg says Icahn Enterprises hasn't done enough to answer questions about margin loans and losses.
Source: MarketWatch - 🏆 3. / 97 Read more »

Stock picker's market sprouts as investors snap up single shares: BofAA stock picker's market is forming for the first time since 2008 as investors ditch ETFs and pile into single shares, Bank of America says
Source: BusinessInsider - 🏆 729. / 51 Read more »

Stock market news today: S&P 500 gains as inflation coolsUS stocks rise after CPI shows inflation rose at slowest pace in 2 years in April
Source: BusinessInsider - 🏆 729. / 51 Read more »

Bud Light parent company's stock downgraded by HSBC amid branding 'crisis,' huge sales dropHSBC is downgrading Anheuser-Busch InBev to hold following the Bud Light 'crisis' involving a marketing campaign featuring transgender activist Dylan Mulvaney.
Source: FoxBusiness - 🏆 458. / 53 Read more »