Main Street savers hunting for better returns seem to be in the same boat as the so-called "smart money" on Wall Street: Lots of investors bought the recent stock market peak.
"We saw hefty inflows into stock mutual funds Monday, Tuesday, and Wednesday [last week] even with the market starting to crack," Charles Biderman, founder and CEO of investment research firm TrimTabs, told CNBC's "Squawk Box" on Monday. "So that is not a good sign if you see individual investors getting in when the market is starting to break."
Individual investors get the rap for being terrible market timers, but hedge fund managers haven't had much better luck. In a reversal of a three-year trend, hedge funds saw inflows to equity-based products last month and outflows from fixed income, according to institutional investor tracker eVestment.
(Read More: Hedge Funds Shift to Stocks, in Time for Pullback)
TD Ameritrade Chairman Joe Moglia chose to look on the positive. "I think the reason why we're having the kind of [stock] correction that we've seen in the last few days is because we've had a pretty spectacular run," he told CNBC.
Last week, Federal Reserve Chairman Ben Bernanke ignited a sharp stock decline and a spike in bond yields with talk that quantitative easing could start to wind down this year provided the economy holds up. "Bernanke gets involved because the economy is going better. That's almost a calming effect," Moglia said. "While you're backing-off on your buying, you're doing that for a really positive reason."
(Read More: Bond Fund Outflows Hit Record on Tapering Fears)
But so far, the stock and bond markets have been anything but calm in their reaction to the signaling from the Fed.
Biderman at TrimTabs said bond fund outflows are "starting to impact bond prices because the flows are pretty massive." Portfolio managers are being "forced to sell bonds to meet redemptions," he added. "That's not a good sign."