AAII Sentiment Survey: Pessimism Rises

Pessimism among individual investors about the short-term outlook for stocks increased in the latest AAII Sentiment Survey. Meanwhile, optimism and neutral sentiment decreased.

Bullish sentiment, expectations that stock prices will rise over the next six months, decreased 7.6 percentage points to 33.3%. Bullish sentiment is below its historical average of 37.5% for the fourth time in six weeks.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, decreased 1.2 percentage points to 23.8%. Neutral sentiment is below its historical average of 31.5% for the 29th time in 31 weeks.

Bearish sentiment, expectations that stock prices will fall over the next six months, increased 8.8 percentage points to 42.9%. Bearish sentiment is unusually high and is above its historical average of 31.0% for the 10th time in 12 weeks. Bearish sentiment was last higher on November 2, 2023 (50.3%).

The bull-bear spread (bullish minus bearish sentiment) decreased 16.5 percentage points to –9.5%. The bull-bear spread is below its historical average of 6.5% for the fifth time in seven weeks.

This week’s special question asked AAII members how they would describe the current valuation of stocks.

Here’s how they responded:

• Stocks, in general, are overvalued: 52.5%
• Stocks, in general, are fairly valued: 7.1%
• Valuations are mixed, with some stocks expensive and others cheap: 36.9%
• Stocks, in general, are undervalued: 1.4%
• Not sure/no opinion: 2.1%

See more Sentiment Survey results.