Active Traders Are Bullish on Equities but Economic and Political Concerns Remain
Active traders are expressing renewed optimism about the U.S. stock
market, despite ongoing concerns about the economic and political
environment, according to new data from two Charles Schwab studies
released today. In Schwab’s most recent Active Trader Sentiment
Survey, 52 percent of active trader clients say they have a bullish
outlook on stocks in the next three to six months, while only 17 percent
consider themselves bearish.
While respondents expressed general enthusiasm about stocks, they also
acknowledge that global economic issues (27 percent) and the U.S. budget
deficit (20 percent) are currently high on their list of concerns. In
addition, while many major market averages are at or near all-time
highs, only 12 percent of respondents say their biggest concern is that
the stock market is over-inflated. A relatively small number express
concern about the health of the U.S. housing market (2 percent),
inflation (5 percent) or unemployment (8 percent).
Separately, 61 percent of active trader clients surveyed in Schwab’s Q1
2013 Investor Confidence Study say this is a good or very good time
to invest in equities, a significant increase from just 33 percent who
felt this way in the fourth quarter of 2012. Fifty-eight percent of
active traders in this survey also say they feel extremely or very
confident making investment decisions now, compared to 50 percent last
quarter.
“We’ve seen an overall shift in sentiment among active trader clients
from wariness in the fourth quarter of 2012 to cautious optimism going
into the second quarter of this year,” noted Kelli Keough, Senior Vice
President of Client Experience at Charles Schwab. “When talking to our
clients, we continue to emphasize that education, discipline and
strategy are key to staying nimble in the current market environment.”
Additional key findings of the Active Trader Sentiment Survey
include:
-
New opportunities seen in healthcare. More than a quarter of
respondents (27 percent) say they are most bullish on the healthcare
sector, compared to 17 percent in November 2012 and up from just six
percent one year ago. Other sectors viewed favorably in the latest
survey include energy (18 percent), technology (16 percent) and
financials (14 percent).
-
Diversification outside of the U.S. is important. While the
majority of active traders favor domestic investing opportunities,
nearly one quarter (24 percent) believe markets outside the United
States offer a better opportunity for growth.
-
Portfolio risk is a concern. Less than 14 percent of traders
say they are “very confident” that their portfolios are properly
hedged against risk. More than one-third consider themselves “not
confident enough.”
-
Government suspicion remains. An overwhelming majority of
respondents (63 percent) give the government a grade of “D” or “F”
when it comes to pursuing pro-investing policies. Only one percent say
the government deserves an “A.”
Schwab provides active traders with cutting-edge trading platforms, free
seminars and workshops, online education resources and 24-hour access to
experienced trading specialists, with no minimum trade requirements. For
more information, please visit www.schwab.com/AT
or call 888-245-6864.
Follow us on Twitter: @Schwab4Traders.
About the Charles Schwab Active Trader Sentiment Survey
Data from the Charles Schwab Active Trader Sentiment Survey were
derived from responses of approximately 200 attendees of Charles
Schwab’s virtual trader event on March 28, 2013.
About the Charles Schwab Investor Confidence Study
Data from the Charles Schwab Investor Confidence Survey were
derived from responses of 1,150 retail clients. Online interviews were
conducted from March 8 through March 20, 2013.
About Charles Schwab
The Charles Schwab Corporation (NYSE:SCHW) is a leading provider of
financial services, with more than 300 offices and 8.9 million active
brokerage accounts, 1.6 million corporate retirement plan participants,
888,000 banking accounts, and $2.08 trillion in client assets as of
March 31, 2013. The company was ranked ’Highest in Investor Satisfaction
with Self-Directed Services’ in the 2012 US Self-Directed Investor
Satisfaction StudySM from J.D. Power and Associates. Through
its operating subsidiaries, the company provides a full range of
securities brokerage, banking, money management and financial advisory
services to individual investors and independent investment advisors.
Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC,
www.sipc.org),
and affiliates offer a complete range of investment services and
products including an extensive selection of mutual funds; financial
planning and investment advice; retirement plan and equity compensation
plan services; compliance and trade monitoring solutions; referrals to
independent fee-based investment advisors; and custodial, operational
and trading support for independent, fee-based investment advisors
through its Advisor Services division. Its banking subsidiary, Charles
Schwab Bank (member FDIC and an Equal Housing Lender), provides trust
and custody services, banking and lending services and products.
Investment products offered by Charles Schwab & Co., Inc. are not
insured by the FDIC, are not deposits or obligations of Charles Schwab
Bank, and are subject to investment risk, including the possible loss of
principal invested. More information is available at www.schwab.com
and www.aboutschwab.com.
(0413-3246)
International investments are subject to additional risks such as
currency fluctuation, geopolitical risk and the potential for illiquid
markets.
