AAII Sentiment Survey: Pessimism Pushes Higher

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 4.7 percentage points to 28.0%. Bullish sentiment is below its historical average of 37.5% for the seventh time in 11 weeks.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, decreased 1.5 percentage points to 22.5%. Neutral sentiment is below its historical average of 31.5% for the 60th time in 62 weeks.

Bearish sentiment, expectations that stock prices will fall over the next six months, increased 6.1 percentage points to 49.5%. Bearish sentiment is unusually high and is above its historical average of 31.0% for the 41st time in 43 weeks.

The bull-bear spread (bullish minus bearish sentiment) decreased 16.6 percentage points to –21.5%. The bull-bear spread is unusually low and is below its historical average of 6.5% for the 30th time in 32 weeks.

This week’s special question asked AAII members what type of stocks they are favoring right now.

Here is how they responded:

• Dividend stocks: 24.3%
• Value stocks: 12.9%
• Growth stocks: 10.3%
• Small-cap stocks: 4.0%
• A mix of the above/other: 48.5%

See more Sentiment Survey results.