Bloomberg reports that according to Deutsche Bank AG strategists, U.S. stimulus checks could unleash a $170 billion wave of fresh retail inflows to the stock market.
A survey of retail investors showed respondents planned to put 37% of their stimulus cash directly into equities, a team including Parag Thatte wrote in a note. With potentially $465 billion of direct stimulus being planned, that adds up to $170 billion, they said.
“Retail sentiment remains positive across the board, regardless of age, income or when the investor began trading. Retail investors say they expect to maintain or add to their stock holdings even as the economy re-opens.” the strategists wrote.
According to Deutsche, new investors are younger and more aggressive, and much more likely to trade options frequently compared with more experienced traders. When faced with a hypothetical modest selloff, a majority of respondents said they would increase their investments, the note said -- though on net they’d pull out money if the selloff surpassed 10%.
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