Home ›› 02 Jan 2022 ›› Stock
As part of the most recent American Association of Individual Investors (AAII) Sentiment Survey, AAII asked its members how their portfolios performed this year relative to their expectations at the start of 2021.
AAII reported that nearly three out of five respondents (57 per cent) described their returns as being better than expected. This group included those who said their returns were much better than expected (slightly more than 10 per cent of all responses).
Approximately 7 per cent of respondents described their portfolios as having performed close to their expectations, while 11 per cent used words such as “well,” “average” or “satisfactory.”
Meanwhile, about 12 per cent of respondents said their portfolios underperformed relative to their expectations.
Here are a couple of quotes from investors on the matter -
“Performed above exceptions. I was pleasantly surprised by the brief outperformance of value, especially small-cap value. More of that please.”
“Below average as I was too conservative during the year waiting for the next big correction to occur, which never did.”
Bulls bound ahead
individual investor optimism about the short-term direction of the stock market jumped in the last week of 2021 according to the latest American Association of Individual Investors Sentiment Survey (AAII). With this, fewer investors described their outlook for stocks as “bearish.”
AAII reported that bullish sentiment, or expectations that stock prices will rise over the next six months, surged 8.1 percentage points to 37.7 per cent, to a six-week high. That said, optimism remains below its historical average of 38.0 per cent for the sixth consecutive week.
Bearish sentiment, or expectations that stock prices will fall over the next six months, fell 3.3 percentage points to 30.5 per cent. Pessimism was last lower on November 18, 2021 (27.2 per cent). Bearish sentiment currently matches its historical average of 30.5 per cent.
Neutral sentiment, or expectations that stock prices will stay essentially unchanged over the next six months, declined 4.8 percentage points to 31.8 per cent. Neutral sentiment is above its historical average of 31.5 per cent
for the fourth consecutive week.
AAII noted that since falling to an unusually low level of 25.2 per cent two weeks ago, bullish sentiment has rebounded by a cumulative 12.4 percentage points. The improvement occurred as the S&P 500 index (.SPX) rose to new highs, and the Russell 2000 (.RUT) index rallied.
With these changes, the bull-bear spread rose to +7.2 from -4.3 last week.
US stocks paused on Friday, after a recent rally put Wall Street's main indexes on pace to finish the year with handsome gains driven by massive stimulus, vaccine rollouts, and strong retail participation.
Indeed, the main US indexes are virtually flat in the early throes of the last trading day of the year. With this, a majority of major S&P 500 (.SPX) sectors are showing net changes ranging from -0.1 per cent to +0.1 per cent on the day.
