In the fallout from Britain’s vote to leave the European Union, TD Ameritrade CEO Fred Tomczyk weighs in on the reaction the firm is seeing from U.S. investors.
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“Certainly when the market opened [after the vote] we saw unprecedented activity into people’s accounts. A lot of people checking in just to see what’s happened with the markets and with their positions. Just to give you one piece of data, August 24 of last year was the busiest trading day we’ve ever had in our history, and yesterday in the first hour we saw volumes that were in excess of that, in some cases 50% greater than that,” Tomczyk told the FOX Business Network’s Maria Bartiromo.
Tomczyk explained why Brexit created such uncertainty for the markets.
“[Brexit] has created a lot of uncertainty,” Tomczyk said. “That was clearly a surprise. I think we all have to remember that going into the vote the markets were rising, expecting a ‘stay’ vote and unfortunately it went the other way, so the markets were totally caught off guard.”
Tomczyk said TD Ameritrade clients are proceeding with caution on the heels of the news.
“The risk-off trade is on right now,” he said. “So people are definitely moving to being more conservative right now.”
He also said the most bleeding on Wall Street was coming from the financial sector.
“We have to remember that in the U.S. market where the bulk of the investments are for our investors, the market rose going into the vote and then came back to where it was, so it really wasn’t much of a move. U.S. market was really only down 3%. I think the bigger impact was in financials. The U.S. financials were off two to three times that amount.”