Two out of Five Investors Believe Volatility Levels Will Rise

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This week’s Sentiment Survey special question asked AAII members what they thought about the stock market’s return to a relatively low state of volatility. Responses were mixed. (The S&P 500 index has gone approximately 50 days without closing up or down by 1% or more.) Nearly two out of five respondents (37%) do not think the current calm will continue. Many of these respondents say they expect volatility to jump after the November midterm elections. Slightly more than 14% of respondents describe themselves as being pleased with the low level of volatility. Approximately 9% are either surprised by the current calm or say they don’t understand why the markets are so calm given the macro backdrop. About 6% say volatility does not impact their investing decisions. A small group of respondents indicate that they do not perceive the market as currently being calm.

Here’s a sampling of the responses:

  • “I doubt this will persist.”
  • “I don’t think much about volatility because I am a long-term investor.”
  • “It could be the calm before the storm. I think the midterm elections will have an impact.”
  • “I’m surprised given all the political and trade issues going on.”
  • “Low volatility is always good in my opinion.”

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