The Spectrem Millionaire Investor Confidence Index (SMICI®) fell six points in December to 4, its lowest reading in four months. The Spectrem Affluent Investor Confidence Index (SAICI®) dipped two points to -1, a return to negative territory for the fifth time this year.
The indices measure the investment confidence and outlook of households with more than $500,000 of investable assets and more than $1 million of investable assets, respectively.
Though there was a a setback from November, when the robust market boosted Millionaire investor confidence in particular to its second-highest reading in the past 10 months, both indices have improved since December 2012, when the SAICI was -9 and the SMICI was -2.
After reaching unprecedented highs in November, the market retreated in December. This has compelled Affluent investors to again adopt a wait-and-see strategy toward investing. Spectrem’s monthly survey of investor preferences for the coming month found that Affluent respondents who said they would “Not Invest” surged to a five-year high.
Despite signs of improvement in December, ranging from a better-than-expected November jobs report (released at the beginning of the month) to outgoing Federal Reserve Chairman Ben Bernanke’s eagerly-anticipated announcement that the Fed intends to begin tapering its stimulus program, the economy is considered by Affluent investors to be the most serious threat to achieving their household’s financial goals at this time.
Setbacks in the market and encouraging signs of improvement in the economy sent mixed messages that caused the Spectrem Affluent Household Outlook, a monthly measure of Affluent investor confidence in four factors that impact their daily lives, to dip 4 points in December.