Registered: Aug 2006
08-22-12 01:38 PM
Trading volume at 5-year low.
By Hibah Yousuf @CNNMoneyInvest
NEW YORK (CNNMoney) -- August is always a quiet month on Wall Street as traders escape to catch some rays during the final days of the summer, but this year's lull is more pronounced than usual.
Trading volume hasn't been this low since September 2007, with a daily average of fewer than 3.3 billion shares exchanging hands so far this month. And trading volume is down more than 30%, compared with the average August over the past five years.
Trading volume has been trending lower since the height of the financial crisis, creating a new dynamic that investors are still trying to adjust to.
For starters, the market has virtually lost a generation of investors.
"Individual investors don't want much to do with stocks," said Detrick, pointing out that money has been bleeding out of stock mutual funds.
But even still, volumes aren't likely return to the financial crisis levels anytime soon.
A majority of respondents to a recent Credit Suisse survey said it will take 2-5 years, or even longer, for volumes to recover. And nearly half said macro risks -- Europe's debt crisis, the U.S. fiscal cliff and deficit, and potential recessions -- need to be resolved before investors are willing to step back in with conviction. That's a tall order.
Trading volume has slumped to the lowest level since September 2007, with a daily average of fewer than 3.3 billion shares exchanging hands so far this month.