Stock ETFs

As the equities market returns to pre-2008 financial crisis levels, more investors are dipping their toes back into stocks and related exchange traded funds.

Main Street investors could be ending their self-imposed exile from the stock market, USA Today reports. Initial data suggests that retail investors are becoming more confident in stocks than they have been in years and want to take on greater risk with stocks and equity funds.

According to the American Association of Individual Investors, 52.3% of investors were bullish, the highest since January 2011. Meanwhile, the widely observed VIX or “fear gauge” is trading at its lowest since April 2007. [Treasury ETFs Fall: ‘Great Rotation’ from Bonds to Stocks?]

On Thursday, the Willshire 5000 stock index, which follows 3,700 stocks, briefly topped its Oct. 9, 2007 record high of 15,806.69. According to Wilshire Associates, stocks generated almost $11 trillion in gains since the bear market ended March 2009. [Investors Bullish on Stock ETFs as S&P 500 Nears All-Time High]

Meanwhile, the Dow Jones Industrial Average and the S&P 500 are only 2.4% and 4.5% shy of their respective peaks.

“Is the retail investor back? Not fully. But they certainly are on the path to coming back,” Steve Quirk, senior vice president of TD Ameritrade’s Trader Group, said in the article.

“I would not call it a mad rush into stocks or a mad panic to buy, but it is a positive for the market to see retail investors returning,” David Brown, chief market strategist at Sabrient Systems, said.