Retail investors have been fueling a frenzied buying boom in markets this year, sparking fears that they are driving too much speculation in the market. Retail investors have opened a huge number of accounts at online brokerages this year. Red flags were raised after those retail investors piled into riskier segments of the market. At one point, some bankrupt stocks and penny names saw their shares double in one session, while the most beaten-down shares were also bid up drastically.
There’s always an opportunity to shift from the technology stocks that have had such a huge run-up, into other stocks that look much better in terms of valuations. Confidence returns to the recovery story … as every major economy continues to improve, and so I think as investors start to get a better sense of that, they will start looking to the so-called old economy stocks.