Throughout the month of May, the United States and China continued to discuss their trade relations but there was absolutely no progress reported. Instead, both sides issued plans to increase tariffs on incoming products, and significant portions of the American economy was impacted.
While the stock market remained high and relatively steady, and federal interest rates remained at current rates, investors were uncertain what to think about how investing fortunes are going to move as the 2019 summer months approach.
Spectrem’s Investor Confidence Indices for May indicated that investors are wary of how global trade conflicts will impact the American economy and international investing.
According to the Spectrem indices, investing interest among Millionaires increased except in the area of individual stocks. Meanwhile, investing intentions among non-Millionaires were static except for stock investing, while more investor pulled back from adding to their investing intentions for the coming month.
Millionaires also showed an increased interest in investing in safety products such as bonds and cash, indicating an interest in increasing investment allotments but doing so in less volatile categories.
Here is a comparison of investors based on specific segmentation:
Millionaires vs. Non-Millionaires
- The numbers that jump out from the May Spectrem Confidence Indices are these: an increase of more than 8 percent of Millionaires investing in cash products, and four times more investors adding to their individual bond investing (from 3.9 percent to 15.4) percent. Bond mutual fund investing nearly doubled among Millionaires. Alongside a decrease in those not investing to 28.7 percent, it seems Millionaires are active but careful in where their money is going.
- Non-Millionaires meanwhile decreased interest in stock investing to a relatively low level of 15.8 percent, and stayed relatively steady toward other investment products. However, 53.5 percent of non-Millionaires said they have no intention of adding to their investment portfolios in the coming month, a third consecutive increase in that area, which has risen from 37.9 percent in February.
Men vs. Women
- Segmented by gender, men and women generally agreed in May about what they planned to do with their investments, although women increased their real estate investing to a level higher than men. Fewer women also indicated that they would not add to their investment allotments, meaning more women planned to invest in June than in May.
- Individual bond investing rose significantly among both genders, and among women, it rose from 2.3 percent to 8.5 percent. Bond mutual fund investing among males rose from 8.5 percent to 14.3 percent, one of the highest levels of the year.
- The overall confidence of males fell among both all investors and among Millionaires, while the confidence indices for women rose and among Millionaire women climbed out of negative territory for the first time in three months to zero.
Republican vs. Democrat
- It is unusual, under a Republican-led administration, for Democrats to show more confidence in investing than Republicans, at least when comparing month-to-month results. But in May, Democrats showed an increased interest in investing across all products, while Republicans pulled away from stock investing and showed that more investors are not going to increase their investing in the coming month.
- What Republicans did show interest in was bonds, both individual and mutual funds. Individual bond investing rose from 3.41 percent to 17.65 percent among Republicans, and rose from 6.92 percent to 14.71 percent for bond mutual funds. With cash investing increasing as well among Republicans, it appears they have an interest in adding to their safer investment products in May.
- However, among Democrats, all investment products showed an increase in interest, most notably in stock and stock mutual fund investing. At the same time, there was a large decrease in those not investing, from 55.36 percent to 40.58 percent.
Working vs. Retired
Retired investors were not impressed with the atmosphere for investing in May. They showed a reduced interest in all forms of investing other than cash, which saw only a slight increase. Those not investing climbed to a 2019 high of 57 percent among retried investors.
Among working investors, there was an increased interest in investing except for individual stocks and real estate, and those not investing fell to 28.7 percent, after reaching a 2019 high in April.
Among working investors, stock mutual fund investing rose by almost 10 percent to 38 percent. Individual bond investing also rose, from 4.2 percent to 15.5 percent.
©2019 Spectrem Group