AAII Sentiment Survey: Pessimism Retreats
Pessimism among individual investors about the short-term outlook for stocks decreased in the latest AAII Sentiment Survey. Meanwhile, optimism and neutral sentiment increased.
Bullish sentiment, expectations that stock prices will rise over the next six months, increased 2.2 percentage points to 35.7%. Bullish sentiment is below its historical average of 37.5% for the eighth consecutive week.
Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, increased 6.3 percentage points to 21.3%. Neutral sentiment is unusually low and is below its historical average of 31.5% for the 90th time in 92 weeks.
Bearish sentiment, expectations that stock prices will fall over the next six months, decreased 8.4 percentage points to 43.0%. Bearish sentiment is unusually high and is above its historical average of 31.0% for the ninth consecutive week.
The bull-bear spread (bullish minus bearish sentiment) increased 10.6 percentage points to –7.2%. The bull-bear spread is below its historical average of 6.5% for the ninth consecutive week.
This week’s special question asked AAII members what changes, if any, they’ve made to their portfolio since the start of the Iran war.
Here is how they responded:
I have not made any changes (maintained existing positions): 42.3%
I have added to existing positions or bought new ones at lower prices: 24.9%
I have reduced equity exposure (sold stocks or funds, raised cash): 14.8%
I have made other adjustments (e.g., rebalanced, increased bond or commodity allocation): 10.6%
I have shifted holdings toward defensive sectors (e.g., energy, defense, utilities): 7.4%
This week’s Sentiment Survey results:
Bullish: 35.7%, up 2.2 points
Neutral: 21.3%, up 6.3 points
Bearish: 43.0%, down 8.4 points
Historical averages:
Bullish: 37.5%
Neutral: 31.5%
Bearish: 31.0%
See more Sentiment Survey results.
