Were Are Small Investors Investing These Currently.

Trading U.S. stocks has become unreal and every so often scary. Devoid of any news, fundamental or technical causes the market leaps in one direction withing minutes The retail investor has selected not to participate and has stayed away. This time they clearly recall the last market swoon that left may in total shock and much poorer.

The market has plainly become schizophrenic and leaves most observing in total incredulity. As the retail has left, he has been replaced by Quant traders who locate their computers next the exchanges to squeeze and advantage over their rivals This the market we currently have were news, fundamental and technical analysis take a back seat to the mighty computers. More than 50% of the trading volume each day is now attributable to the Quant's or computerized trading

We are witnessing a major paradigm shift in the markets and its hard to envision that things will revert to the way things used to be. Have you watched as bad news has come out and the market promptly skyrockets up It time to appreciate that computers do not read the Wall Street Journal. It has nothing to do what we term reality; it’s just the way the money can be made.

So what is an investor left to do? If current trends maintain Quant’s will account for an ever-increasing portion of the volume and trading and more retail traders and investors will search for preferable investment climates offshore. Many retail investors already believe the market is rigged. It may appear that way, but what is happening is that the Quan'ts have a huge amount of money and computer power that they can move markets and you cannot compete with them. The number of U.S. household that owns stocks has decreasd to a low of approximately thirty seven percent from the usual mid fifties. These investors will not be coming back. The trend has been in place for a while now and seems to be irreversible. Is there any reson that they should invest un U.S stocks? The Dow Jones Industrial average has had a negative return for the past ten years when adjusted for inflation and is almost at the same level it was then.

So what is a small investor to do? Some have begun to invest in emerging market since they fell that it offers greater returns with similar risk As witnessed by the recent new highs in the price of gold and silver, some are investing in precious metals The changes in the markets are here to stay and so is the domination by computerized trading. Leaving the small trader and investor looking for other arenas to be able to take part on equal footing.

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I have been writing articles about trading for a long time, I just finished writing an article on FX Trading Tips which you are welcomed to read at FX Trading Tips. See You there.

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