The U.S. stock market is impacted by foreign factors regularly, and continued negotiations with North Korea, China and Iran are creating a period of upheaval in the Dow Jones Industrial Average.
Millionaires do not like that.
The April Spectrem Millionaire Investor Confidence Index (SMICI) and the Spectrem Affluent Investor Confidence Index (SAICI) both recorded notable decreases in April, reflecting a decreasing interest among Millionaires for investing in the stock market.
The SMICI (an index of investors with $1 million in investable assets) dropped 6 points in April, the biggest decrease since May of 2017 when the SMICI fell by a record-breaking 17 points amid high levels of political infighting in Congress. The SAICI (an index of investors with $500,000 in investable assets) fell 4 points, buoyed slightly by the less pessimistic non-Millionaire segment.
The April fielding took place April 19-23, during which the DJIA closed lower every day.
Here is a look at how the indices shook out based on segmented investors:
Millionaires vs. Non-Millionaires
- Millionaires simply pulled away from the stock market in April, with significantly lower interest in Stock (27.9 percent) and Stock Mutual Fund (35.7 percent) investing. Both interest ratings were at levels not seen since May of 2017. Millionaires expressed an increase interest in the safety pockets of Cash and Bond Mutual Fund investing, and those Millionaires choosing to Not Invest (meaning not increasing their level of investment in the coming month) increased to 31 percent, the highest percentage since September.
- Non-Millionaires also dropped their interest in Stock investing to 28.1 percent, but they increased their interest in Stock Mutual Fund investing to 35.5 percent, nearly equal to the Millionaires’ interest level of 35.7 percent. Non-Millionaires Not Investing fell to 34.7 percent, the lowest level since August of 2016 and the third month in a row fewer non-Millionaires were maintaining investment levels.
Men vs. Women
- Pessimism among male investors was consistent, and only 28.6 percent of males expressed interest in investing in Stocks, a six-month low. Males Not Investing ticked up to 29.2 percent, the second month in a row of increased disinterest among male investors.
- The female investors, on the other hand, were far more optimistic, with a 4 percent increase in Stock investing (opposed by a 4 percent decrease in Stock Mutual Fund investing). Females Not Investing dropped to 40.2 percent.
- The overall indices for both men and women fell, and among Millionaire women the SMICI dropped a staggering 16 points to -9.
Republican vs. Democrat vs. Independent
- Republican investors are expected to approve of economic moves made by a Republican president and a Republican-led Congress, but in April those Republican investors begged off. Republican investors reported decreases in interest in all investing products and almost 31 percent said they would not be investing additional funds in May. There has not been a similar expression of pessimism among Republicans in the last 12 months of the Spectrem indices.
- Democrats, on the other hand, expressed increase interest in Stock investing, and Bond Mutual Fund investing, and fewer Democrats (39.06 percent) said they were Not Investing in May.
- The Republican overall indices fell by 11 (SAICI) and 12 (SMICI) points, In the past two months, the Republican SAICI has fallen 17 points and the SMICI has dropped 23 points.
Working vs. Retired
- After expressing pessimism for investing in March, working investors rebounded slightly in April, showing increased interest in Stock Mutual Fund investing. Retired investors, on the other hand, did not express increased investing interest in products other than Bond Mutual Funds. The percentage of retired investors Not Investing rose to 43.6 percent, while working investors Not Investing dropped to 24.4 percent.
- The SAICI and SMICI both fell for both retired and working investors, with larger decreases recorded by retired investors. The SAICI and SMICI were both at 13 for working investors, the lowest mark since August of 2017.
©2018 Spectrem Group