Research Shows That Institutional Investors Are The "Dumb Money"

New research from TrimTabs confirms that Institutional Investors (mutual funds, pension funds, brokers and dealers, insurers, etc.) are the "dumb money" in the equity markets. According to the report, "the evidence strongly suggests that institutional investors tend to underperform the market in the long run." The report also states that investors "should view net buying by the institutional sector as a contrarian signal." According to this perspective, the market is due for a correction and investors should be selling their stock holdings. The entire report, which is highly recommended, can be found here.