Retail investors piled into momentum stocks in October, with names such as Facebook, Netflix and Tesla topping their buy lists, according to data culled from the largest pool of retail traders by TD Ameritrade.
"For three consecutive months, we've had net selling in the financial names, and I think a lot of that has been shifting over to some more of the momentum plays," said Nicole Sherrod, TD Ameritrade managing director.
On CNBC's "Halftime Report," she said the company's proprietary "Investor Movement Index" had previously shown a correlation between a bull market and customers' behavior. The IMX turned positive, to a 5.07, for last month.
"What I've observed from the launch of the index is the fact that the retail investors, as the market pushes to higher highs, they tend to take some profits off the table, and they're net sellers," she said.