Change of Direction
The emergence of a dangerous strain of the coronavirus in the United States has caused many investors to rethink their asset allocation positions, although most are waiting to discuss plans with their financial advisor once there appears to be some sort of settling of the health scare issue.
Throughout 2020, Spectrem Group is conducting a special study with approximately 800 investors a month to inform financial providers and advisors what investors are thinking in anticipation of the presidential election in November. However, that study has been extended to include investor concerns related to the coronavirus, which first appeared in the United States early in 2020 but exploded in late February and early March as the first deaths were reported in Washington State.
The market crash in late February and the first two weeks of March changed the conversations about the upcoming election and altered investor perceptions of the state of their personal wealth going forward.
According to Investors and the Election, in February, prior to the first stock market crash related to the coronavirus, 66 percent of affluent investors said their financial situation was better at that moment than it was 12 months prior. In mid-March, that percentage dropped to 60 percent, which is still an overall expression of optimism, but just not as strong.
A similar question, whether investors thought their financial situation will be stronger one year from the present, got a positive response from 50 percent of investors in mid-February but that percentage dropped to 43 percent in mid-March.
Note that those percentages are both lower than the response to the question about comparing today’s net worth to last year’s. That means that investors are not as certain the next 12 months will be as good for their portfolios as the last year was.
Investors and the Election, available on this website, includes information on investment intentions, the predicted impact of the election upon investing, and direct responses to who investors will vote for in the presidential election, narrowing the Democratic field to Bernie Sanders and Joe Biden.
©2020 Spectrem Group
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