Short answer: Yes. Even though the Schwab Trading Activity Index™ (STAX) rose from 40.66 in June to 41.79 in July, the index still falls within the “low‑risk” band for the four‑week period ending July 25 2025.
Why the July reading is still considered “low”
| What the STAX measures | June reading | July reading | Interpretation |
|---|---|---|---|
| Retail‑investor positioning – based on the aggregate size, direction, and turnover of stock positions across Schwab’s millions of client accounts. | 40.66 | 41.79 | Both scores sit in the lower‑range of the index’s scale (the index typically runs from ~0 to 100, with the bottom third classified as “low”). |
| Risk‑environment label (assigned by Schwab’s proprietary thresholds) | “low” | “low” | The July figure, although modestly higher, has not crossed the threshold that would trigger a “moderate” or “high” risk label. |
The STAX is a behavior‑based indicator, not a price‑or‑volatility index. It captures what retail investors actually do—how many are buying, holding, or selling, and how aggressively they are trading. Schwab’s internal methodology groups the raw score into three risk bands:
| Score range | Risk label |
|---|---|
| 0 – ~45 | Low |
| ~45 – ~65 | Moderate |
| > ~65 | High |
July’s 41.79 sits comfortably inside the “low” band, even though it nudged upward by 1.13 points (≈2.8 % increase) from June. That uptick reflects a slightly more optimistic or “cautiously optimistic” stance among retail investors—evidenced by a modest rise in net buying or a modest reduction in net selling—but the overall behavior still points to conservative positioning.
What the modest rise tells us
Cautious optimism:
- The increase suggests investors are a bit more willing to take positions than in June, perhaps reacting to a recent market rally, earnings season, or macro‑data that reduced perceived downside risk.
- However, the rise is well below the moderate‑risk threshold, indicating that the optimism is measured rather than exuberant.
- The increase suggests investors are a bit more willing to take positions than in June, perhaps reacting to a recent market rally, earnings season, or macro‑data that reduced perceived downside risk.
Liquidity and turnover:
- A higher STAX can also signal increased trading activity (more turnover) while still keeping net exposure modest. The “low” label implies that the net exposure (overall long‑vs‑short balance) remains conservative.
Risk‑management context:
- For portfolio managers, advisors, and risk‑aware investors, a “low” STAX still suggests a relatively safe environment for taking on new positions.
- The slight upward tick may be a cue to monitor for any acceleration that could push the index toward the moderate zone in the coming weeks.
- For portfolio managers, advisors, and risk‑aware investors, a “low” STAX still suggests a relatively safe environment for taking on new positions.
Bottom line
- July’s STAX of 41.79 is still classified as “low.”
- The upward movement reflects a modest, cautious optimism among Schwab’s retail client base, but it has not altered the overall risk assessment for the period ending July 25 2025.
- Consequently, the market environment, as judged by Schwab’s proprietary behavior‑based index, remains low‑risk despite the modest rise.