NYSE Floor Trader Breaks Down The Market Sell-Off: 'For Every Seller, There's A Buyer'

Kenny Polcari, Director of NYSE floor operations for O'Neil Securities, joined Benzinga's PreMarket Prep trading show Thursday to discuss the October sell-off in the stock market.

Buying The Dip

There’s not as much selling going among institutional investors as traders may assume, according to the floor trader.

“I’ve got news for you--I was a net buyer last week and I was a net buyer yesterday,” Polcari said.

“For every seller, there’s a buyer,” he said. “I didn’t say I wasn’t a seller, but net-net on balance I was a better buyer yesterday than I was seller.”

Polcari's clients have been rotating their money away from growth stocks and toward value stocks, which could provide protection in the event of an economic downturn.

“Yes, money is moving out of some sectors, and being put into other sectors that they feel will perform better if, in fact, the economy is slowing down. It goes from growth to value. Value stocks are going to be great names,” he said.

Boring Value Stocks

Polcari said value stocks are unlikely to provide much excitement for traders, but they will at least limit near-term risk.

He said investors should be careful not to put too much weight on one day or one week of trading and consider any opportunities it may have created.

“If the underlying fundamental story hasn’t changed and those stocks have gotten punished unnecessarily, that’s where you’re going to find your opportunity,” he said.

For now, Polcari said investors should give the market a few days to settle down and let the dust settle on the recent volatility before jumping to conclusions about potential longer-term bearish trends.

Listen to the full interview with Kenny Polcari at 34:30 in the clip below.

PreMarket Prep is a daily trading show hosted by prop trader Dennis Dick and former floor trader Joel Elconin. You can watch PreMarket Prep live every day from 8-9 a.m. ET here. The replay can be found on Benzinga's YouTube channel, and the podcast is on iTunes, Google Play, Soundcloud, Stitcher and Tunein.

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