Last month’s Asset Allocation Survey special question asked AAII members to describe the impact that the Federal Reserve’s rate hikes are having on their asset allocation decisions. Half of all respondents (50%) said that the rate hikes have had no impact on their allocation decisions. Several of these respondents view the hikes as either having already been priced in or too small in size to have an impact. An additional 8% of respondents said that the rate hikes have had just a minimal impact on their allocation decisions. Ten percent boosted their bond allocation, with a particular focus on short-duration bonds. Another 6% of respondents are maintaining their bond allocation. Approximately 8% have either reduced their bond allocation or are avoiding bonds.
Here is a sampling of the responses:
- “I’m staying away from bond funds of any meaningful duration.”
- “No reaction. Already baked into the market sentiment.”
- “Not much impact. Did move a bit from cash to short-term Treasuries.”
- “None. The Fed has not moved enough to have a significant impact.”
- “At this time, no impact at all.”
The AAII Asset Allocation Survey has been conducted monthly since November 1987 and asks AAII members what percentage of their portfolios are allocated to stocks, stock funds, bonds, bond funds and cash. The survey and its results are available online at: http://www.aaii.com/investor-surveys.
Want to weigh in? Take the survey yourself and see results online at http://www.aaii.com/assetallocationsurvey.
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