Bullish sentiment declined this week, but remains at historically high levels. Both the Investor’s Intelligence survey and AAII survey declined on the week. Charles Rotblut of AAII detailed the results of the AAII survey:
“Bullish sentiment fell in the latest AAII Sentiment Survey, but still remains at high levels. The percentage of individual investors expecting stocks to rise over the next six months fell 11.7 percentage points to 51.6%. This is the 17th consecutive week that bullish sentiment has been above its historical average of 39%.
Neutral sentiment, expectations that stock prices will remain essentially flat over the next six months, rose 8.0 percentage points to 28.3%. This is a 14-week high for neutral sentiment. The historical average is 31%.
Bearish sentiment, expectations that stock prices will fall over the next six months, rose 3.6 percentage points to 20.1%. This is the 14th time in the last 16 weeks that pessimism has been below its historical average of 30%.”
The Investor’s Intelligence survey declined from 58.8 to 56.6 on the week. Although these sentiment readings are off their recent highs they remain extremely high by historical standards.
Source: AAII, II
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.