Traders may have to wait for monetary tightening – or an unanticipated event – for excitement to return to the floor.
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Only twice this year have investors had to deal with a 1 percent drop for the Standard & Poor's 500 index in a day.For now, markets have been so calm that the biggest loss for the S&P 500 last week was just 0.2 percent. Compare that to the whiplash investors felt during the summer of 2011, when the S&P 500 swung by more than 4 percent each day during one four-day stretch.Investors fortunate enough to be in the market have enjoyed all the upside of owning stocks with almost none of the traditional downside. Stocks are supposed to be volatile, and investors have long accepted that having to stomach big swings in price is one of the costs of owning them. All that has helped convince investors to step in as buyers whenever stocks seem vulnerable to a slide, which keeps markets smooth.The central bank also expects to begin paring its vast portfolio of bond investments "relatively soon".In a recent survey of investment managers at about 100 firms by Northern Trust Asset Management, 63 percent called the market's lack of volatility a warning sign that may lead to a stock sell-off.
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