Most Americans don't realize the market gained 30 percent last year, and only 1 in 9 call themselves savvy about investing, according to a survey.» Read More
Even as retail investors shy away, Wall Street is still making a dash for trash.
In fact, the recent exodus of funds from high-yield bonds has only whetted the appetite of institutional investors, who are using the slump in junk prices as a buying opportunity, according to an analysis from the Wall Street Journal.
The mom-and-pop crowd ditched a net $13 billion in junk bonds for the four weeks preceding August 6, a trend that has pushed firms like Alliance Bernstein even deeper into the market.
"Investors who panic in these sell-offs—it's the wrong thing to do," Alliance's Gershon Distenfeld told the Journal.
After close to a year and a half of pumping money into the stock market, mom-and-pop investors have spent most of the summer in hiding.
Since May, money has been streaming out of mutual funds that invest in the stock market—particularly those that are focused on U.S.-based equities. Domestic equity mutual funds surrendered some $26.6 billion in May, June and July, according to data from Morningstar that reflects investor unease over a confluence of factors facing the market.
"Investors certainly have been given enough reason to be cautious," said Art Hogan, chief market strategist at Wunderlich Securities. "Every day, we wake up to a new or intensifying geopolitical problem, whether it's Russia, Ukraine, Pakistan, which could be building up as a problem. We have issues with Ebola—there's a multitude of concerns at the time, even when the market is just a percentage point or two of its record highs."
Consequently, investor behavior has changed.
Tom Conheeney, the longtime president of SAC Capital and top lieutenant to founder Steve Cohen, is stepping down Monday from the No. 2 spot at the former hedge fund's successor company, Point72, a company insider said.
Conheeney will be replaced as president by Douglas Haynes, a former McKinsey executive, the source said. Haynes joined Point72 in February as managing director of human capital. Point72 manages the assets of Cohen and certain employees and family members.
The surprise exit raises questions about Conheeney's standing at Point72. He joined SAC Capital in a less senior capacity in 1999.
David Tepper wasn't joking when he said it was "nervous time" for the stock market.
The billionaire head of the Appaloosa Management hedge fund rattled the markets in May, when he told attendees at the SALT Conference in Las Vegas that he was paring back his equity positions.
"I'm not saying go short, I'm just saying don't be too fricking long right now," he told attendees in remarks that went viral and immediately sent a shiver into the market.
Judging by his most recent quarterly filings with the Securities Exchange Commission, Tepper wasn't trying a sleight of hand, wherein he would try to get investors to sell so he buy at reduced prices.
Read MoreTepper on the market: 'Nervous time'
No, he was selling. Tepper, who made an eye-popping $3.5 billion in 2013, shed multiple positions.
Soros Fund Management, the large family office that manages assets for billionaire George Soros, raised its protection against a U.S. stock market drop dramatically, sparking concerns that the powerful investment firm is expecting a big fall in equities.
During the course of the second quarter, which ended June 30, Soros Fund Management's position in puts—the right to sell at a certain price at an appointed time in the future—in a popular exchange-traded fund tracking the S&P 500 rose to 11.29 million shares, which appears to be a multiyear high for the investment manager. (During the first quarter, the size of that position was just 1.6 million puts, meaning that the second quarter marked a 606 percent increase.)
Based on some simple math, and assuming Soros still held the puts and that they were in the money (meaning they would generate gains if they were exercised today), the notional value of the bearish position is roughly $2.2 billion.
Investors are showing little reaction to the events in Ukraine and the Middle East, taking their cue from a Federal Reserve unlikely to show much concern despite the seriousness of both trouble spots.
An analysis from Goldman Sachs helps explain why the market has displayed only momentary reactions to the ongoing dispute between Russia and the separatists in Ukraine, and actually rallied the day President Barack Obama announced targeted airstrikes against ISIS rebels in Iraq.
Economists Michael Cahill and David Mericle believe investors will continue to dismiss the threats:
The current US air strikes in Iraq are unlikely to have a significant impact on defense spending or oil prices, unless the scale of the conflict changes considerably. Evidence from past U.S. conflicts that were similar in scale also suggests little impact on confidence and at most mixed evidence of a flight-to-safety effect in financial markets. The exchange of sanctions with Russia--a relatively minor U.S. trading partner--is also likely to have only a modest impact on the U.S. economy. Of course, both situations are highly unpredictable.
The collapse of repurchase agreements—"repos" as they are known on Wall Street—signaled the beginning of the financial crisis, and there's trouble brewing in the market again.
Banks are retreating from repos as new regulations tighten controls on the types of risks they're allowed to take and make the trade more expensive, according to a report in The Wall Street Journal.
The practice involves short-term funding in which a hedge fund raises cash by selling securities to banks, which in turn sell to a third party—usually a money market fund—that then sells the bond back at a higher price and pockets the profit. While the process worked well for years, it collapsed when liquidity concerns surfaced at former Wall Street titans Bear Stearns and Lehman Brothers in 2008.
If you follow @ProfJeffJarvis on Twitter, you know that he is a "thinkfluencer," which isn't a real word, nor is it a real Twitter account. Highly entertaining? Yes.
Apparently, Nassim Taleb, author of "The Black Swan," did not take the time to look at @ProfJeffJarvis's avatar (see:beer helmet) or read his biography. Closer inspection surely would have tipped him off that he was being goaded by a parody account.
Carl Icahn sees U.S. markets in a "major asset bubble," and he says the only solution is for activist investors like him to keep companies honest.
"There are numerous challenges we are facing today whether it be monetary policy, unemployment, income inequality, the list can go on and on… but the thing we have to remember is there is something we can do about it: Shareholders, the true owners of our companies, can demand that mediocre CEOs are held accountable and make it clear that they will be replaced if they are failing," Ichan said in a Tumblr post that appeared on Yahoo Finance.
Public perception that activist investors only take short-term positions in companies is untrue, he added, asserting that shareholder vigilance is essential to protect investors.
Call Peter Schiff a gold-bug perma-bear all you want, but he must be doing something right.
Despite his reputation as a perpetual Cassandra whose principal market call has been to buy gold and bet against the U.S. dollar, funds operated by Schiff's firm, Euro Pacific Capital, have been doing very well against their competitors over the past several years.
In fact, Euro Pacific's International Value Fund ranks in the top percentile against its 797 competitors, according to Morningstar rankings. It has done so while avoiding the U.S. market, which is on a 190 percent tear since the March 2009 financial crisis lows. Euro Pacific has most of its funds in privately managed and brokerage accounts and is a relative newcomer to the mutual fund industry, but the results provide a glimpse into how Schiff's strategy has performed.
"He's been called a perma-bear. Meanwhile, the last five years we've been fully invested in stocks," said Andrew Schiff, Peter's lower-profile brother. "Yeah, he's bearish on the U.S. economy, because we're a borrow-and-spend debt-fueled economy. He doesn't like that. He thinks it's a one-way street that's going to end badly. It doesn't mean he's a perma-bear."
CNBC's Patti Domm and Jeff Cox discuss the jobs report and the current dilemma of long-term unemployment.
CNBC's Patti Domm and Jeff Cox discuss the recent GDP numbers and what factors have been affecting it.
Investors give and investors take away, and nowhere has that been more true lately than in value stocks.
Robert Shiller's recent warning on U.S. stocks sent ripples through global markets, but one analyst says he is "dead wrong."
Stocks, bonds and housing might all be getting too expensive, Yale economist says.
Wednesday brings FOMC minutes, but Wall Street downplays the release and looks to the Jackson Hole symposium on monetary policy.