Investors Finally Believe Again

8/27/2018

 

 

Spectrem Millionaire Investor Confidence Index (SMICI®) = 20

July 2018-August 2018 – Up 12

August 2017-August 2018 – Up 10

 

Spectrem Affluent Investor Confidence Index (SAICI®) = 8

July 2018-August 2018 – Up 5

August 2017-August 2018 – Up 1

 

  • The SMICI jumped up 12 points, the highest increase in one month since January of 2014, when the SMICI went from 4 to 17. The SAICI saw a 5-point increase for the first time since December of 2017.
  • The SMICI is at 20 for the first time since April of 2017.
  • Overall, Stock Investing increased from 26.8 percent to 28.8 percent, but among Millionaires, Stock Investing went from 31.0 percent to 41.1 percent.
  • In corresponding fashion, Cash Investing among Millionaires fell to 17.8 percent from 28.6 percent, an indication that investors were taking funds out of cash and putting it into stocks.
  • However, investors not investing additional funds in the coming month stayed firm at 38.8 percent, and has been at or above 36 percent for four months in a row. Among Millionaires, Not Investing fell slightly from 30.2 percent to 27.1 percent.
  • Increased 5 points to 27.90, and the Outlook for the Economy rose from 8.40 to 23.20, the highest mark since January when the new tax laws went into effect.

Investors spent the bulk of the summer balancing their enthusiasm for the stock market and American economy with concerns over tariffs and global trade wars. But in August, investors decided the stock market rally and economic numbers were for real.

The Spectrem Millionaire Investor Confidence Index (SMICI) improved 12 points to 20, the largest single-month increase in more than four years. It also marked the first time the SMICI has been in double digits since March. The last time the SMICI sat in single-digit territory for at least four months was the seven-month stretch from February 2013 to August 2013, when investor confidence was tepid for more than half a year.

The Spectrem Affluent Investor Confidence Index (SAICI) in August bounced to 8, a 5-point increase, and reaching its highest point since March of 2018.

The monthly SAICI tracks changes in investment sentiment among the 17 million households in America with more than $500,000 of investable assets. The SMICI reflects the investment sentiment of households with more than $1 million in investable assets. The August investor fielding took place between August 20 and August 24, 2018.

Among all investors, the only increase among separate components of the Confidence Index was in Stock Investing, in which 28.8 percent of investors intended to invest, a 2 percent jump. But among Millionaires, the increase went from 31.0 percent to 41.1 percent, the first time since February interest in individual Stock Investing topped 40 percent.

There was a notable decrease in Cash Investing among all investors, down to 17.6 percent, an indication that investors were choosing to take more risk with their investable assets than sit their funds in cash accounts. Again, Millionaires spurred the change, with only 17.8 percent of investors placing additional funds in Cash compared to 28.6 percent one month ago.

Every month, investors are asked whether they plan to increase their investments in the coming month, and in August, that percentage stayed at 38.80 overall, with a slight drop among Millionaires matched by a slight increase among non-Millionaires.

The Spectrem Household Outlook, a measure of the long-term confidence among investors in four financial factors which impact a household’s daily life, improved to 27.90 after a mark of 22.90 in July, the lowest Outlook in over a year. Spurring the improved Outlook was a higher mark for The Economy, which rated at 23.20 among all investors after being at the year’s low of 8.40 in July. Both Millionaires and non-Millionaires noted an increased Outlook in the Economy in August. 

 

 

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