AAII Sentiment Survey: Optimism Slides

Investor optimism fell as bearish sentiment rose to 46.2% in the latest AAII Sentiment Survey. Bullish outlook dropped to 29.9%, while more investors now favor dividend and growth stocks.

Optimism among individual investors about the short-term outlook for stocks decreased in the latest AAII Sentiment Survey. Meanwhile, neutral sentiment and pessimism increased.

Bullish sentiment, expectations that stock prices will rise over the next six months, decreased 5.0 percentage points to 29.9%. Bullish sentiment is below its historical average of 37.5% for the third time in seven weeks.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, increased 2.1 percentage points to 24.0%. Neutral sentiment is below its historical average of 31.5% for the 56th time in 58 weeks.

Bearish sentiment, expectations that stock prices will fall over the next six months, increased 2.9 percentage points to 46.2%. Bearish sentiment is unusually high and is above its historical average of 31.0% for the 37th time in 39 weeks.

The bull-bear spread (bullish minus bearish sentiment) decreased 7.9 percentage points to –16.3%. The bull-bear spread is unusually low and is below its historical average of 6.5% for the 26th time in 28 weeks.

This week’s special question asked AAII members what type of stocks they are favoring right now.

Here is how they responded:

• Dividend stocks: 23.9%

• Growth stocks: 18.0%

• Value stocks: 13.1%

• Small-cap stocks: 3.3%

• A mix of the above/other: 41.5%

This week’s Sentiment Survey results:

Bullish: 29.9%, down 5.0 points
Neutral: 24.0%, up 2.1 points
Bearish: 46.2%, up 2.9 points

Historical averages:

Bullish: 37.5%
Neutral: 31.5%
Bearish: 31.0%

See more Sentiment Survey results.