July AAII Asset Allocation Survey: Portfolios Mostly Unchanged Despite Higher Volatility


Higher levels of stock market volatility did not cause many individual investors to alter their portfolio allocations, according to the July AAII Asset Allocation Survey. Rather, allocations among stocks, bonds and cash changed only modestly.

Stock and stock fund allocations rebounded by 0.2 percentage points to 67.4%, following modest declines during the previous two months. The small increase resulted in stock and stock fund allocations staying above their historical average of 60% for the 28th consecutive month.

Bond and bond fund allocations were essentially unchanged for the third consecutive month, holding steady at 15.5%. As was the case in June, the changes in bond fund and bond allocations were very minor (and largely unnoticeable after the results were rounded). July was the third consecutive month with fixed-income allocations below their historical average of 16.0%.

Cash allocations edged down 0.1%, to 17.2%. This was the first time that cash allocations stayed above 17.0% on consecutive months since March 2014 through June 2014. Last month was the 44th consecutive month with a cash allocation reading below its historical average of 24%.

The increased volatility in the stock market and the corresponding weekly swings in our Sentiment Survey did not result in many changes being made to the portfolios of AAII members. Though some members are concerned about the possibility of a sizeable decline in stock prices occurring, many remain frustrated with the continuing low level of interest rates.

Here is a sampling of the responses:

  • “Any changes made to allocations will depend on what the market does.”
  • “I expect to make no significant allocation changes during the balance of 2015.”
  • “Use cash to purchase stocks upon any significant market correction.”
  • “Slowly increase bond holdings, including funds.”

July AAII Asset Allocation Survey Results:

  • Stocks and Stock Funds: 67.4%, up 0.2 percentage points
  • Bond and Bond Funds: 15.5%, no change
  • Cash: 17.2%, down 0.1 percentage points

July AAII Asset Allocation details:

  • Stocks: 33.0%, down 0.6 percentage points
  • Stock Funds: 34.4%, up 0.9 percentage points
  • Bonds: 3.7%, down 0.1 percentage points
  • Bond Funds: 11.8%, no change

Historical Averages:

  • Stocks/Stock Funds: 60%
  • Bonds/Bond Funds: 16%
  • Cash: 24%

*The numbers are rounded and may not add up to 100%.

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.


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