So just an random question. Im looking at the historical price of SPY on google finance. Look at it in the 5 or 10 year. Whats with the volume spike once the crash has happened?, mid November 2008 is about when it begins. Are people bailing out of individual securities in an attempt to diversify and access the broad market? I just have not heard anything about a massive flow into ETF’s or the increase in volume. Is there anything to this, im thinking if this holds true for other ETF’s (i have not looked) would the general rise/recovery in the markets be a result of this “buying the whole market” so it lifts all boats? feel free to correct or enlighten me. im just thinking aloud.
People were liquidating and either going to cash or to some other asset that they thought would do better (though if it wasn’t some kind of treasury, then they just ended up jumping from the Titanic to the Lusitania).
Are you sure the volume spike in SPY does not coincide with general volume spikes for most other securities?
i think most ppl are buying this instead of individual stocks to avoid company specific risk. the market is moving in tandem lately.
most likely hedging accounts that created the volume via hedging (SPY vs S&P futures, SPY vs SPY options, etc)