AAII Sentiment Survey: Pessimism Jumps as Optimism Plunges
by AAII Staff | January 30, 2020
Pessimism among individual investors about the short-term direction of the stock market surged to its highest level in more than three months. At the same time, optimism in the latest AAII Sentiment Survey plunged.
Bullish sentiment, expectations that stock prices will rise over the next six months, fell 13.6 percentage points to 32.0%. Optimism was last lower on December 4, 2019 (31.7%). The historical average is 38.0%.
Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, rebounded by 1.5 percentage points to 31.2%. The historical average is 31.5%.
Bearish sentiment, expectations that stock prices will fall over the next six months, jumped 12.1 percentage points to 36.9%. Pessimism was last higher on October 9, 2019 (44.0%). This the first time bearish sentiment is above its historical average of 30.5% in 15 weeks.
All three indicators are currently within their typical historical ranges.
Our survey period runs from Thursday through Wednesday, with reminders to take the survey sent to a rotating group of AAII members every Monday. The timing of the reminders may have played a role in this week’s results as the global stock markets fell on Monday over fears about the new coronavirus. It’s also worth noting that optimism had reached a 15-month high last week.
Also affecting individual investor sentiment is the market’s upward trend, the phase-one trade deal between the U.S. and China, the November elections, Washington politics, earnings growth, monetary policy, the economy and valuations.
This week’s AAII Sentiment Survey results:
- Bullish: 32.0%, down 13.6 percentage points
- Neutral: 31.2%, up 1.5 percentage points
- Bearish: 36.9%, up 12.1 percentage points
Historical averages:
- Bullish: 38.0%
- Neutral: 31.5%
- Bearish: 30.5%
Want to weigh in? Take the survey yourself and see results online at www.aaii.com/sentimentsurvey.
If you want to become an effective manager of your own assets and achieve your financial goals, consider a risk-free 30-day Trial AAII Membership
Bullish: 32.0%, down 13.6 points
Neutral: 31.2%, up 1.5 points
Bearish: 36.9%, up 12.1 points
Bullish: 38.5%
Neutral: 31.0%
Bearish: 30.5%
See more Sentiment Survey results.
Discussion
Jay Miller from RI posted over 6 years ago:
IT WOULD BE MOST HELPFUL TO KNOW WHY MEMBER INVESTORS BELIEVE WHAT THEY BELIEVE WHICH LEADS TO THEIR POLLING ANSWERS. UNFORTUNATELY, WE HAVE LEARNED IN THE PAST FEW YEARS THAT DECISIONS, CHOICES OR JUDGMENTS ARE BEING FORMED BY WHICH "FACTS" WE RECEIVE RATHER THAN WHAT THE TRUTHFUL FACTS ARE.
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