Bearish sentiment jumped 8% while bullish sentiment declined according to the latest data from the AAII. Overall, the results show a more neutral stance from small investors as the bullishness of last week subsides:
“Bearish sentiment jumped by nearly eight percentage points in the latest AAII Sentiment Survey. Nearly 35% of individual investors said they expect the markets to trend lower over the next six months, the highest level in four weeks. The historical average for bearish sentiment is 30%.
Though the rise in bearish sentiment is notable, it should be considered within the context of market conditions. The major indexes declined twice over the over the past three trading days.”
“Furthermore, bullish sentiment stayed above its historical average for the ninth time out of the past 10 weeks. The survey results show 40% of individual investors expect the markets to rise over the next six months. Bullish sentiment did fall, however, coming in seven percentage points lower than a week ago.”
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.