Tags: Silverblatt | retail | investors | S&P

S&P's Silverblatt: Retail Investors 'Are Not Moving Back Into the Market'

Thursday, 28 Aug 2014 10:04 AM

By Dan Weil

Individual investors have largely shied away from stocks since the market plunged in 2008, and that trend is likely to continue, says Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.

Domestic stock funds saw an outflow of $155 billion from 2008 to 2012, according to The Wall Street Journal. The trend started to shift last year, with $170 billion going into funds.

But individual investors are "still nervous, they're concerned," Silverblatt tells CNBC. That's true even though the S&P 500 has nearly tripled since March 2009.

Editor’s Note:
5 Shocking Reasons the Dow Will Hit 60,000

"Even though we're into this rally over five years now, and they're getting very little if they're sitting in a bank or some alternatives, they are not moving back into the market," he said. And the S&P 500's breach of 2,000 this week won't change that, Silverblatt maintains.

"On the other side you've got institutions, who are sitting in the market. They're reallocating somewhat, but they're not pulling out. These institutions appear to be more concerned with missing out on potential gains than the market declining," he explains.

"Both of these groups are just sitting tight," Silverblatt adds. "And the market, in between, has taken small steps upward."

But Scott Krisiloff, chief investment officer of Avondale Asset Management, offers powerful evidence that stocks will rally for the remainder of 2014.

"Since 1950, the S&P 500 has been positive through August 42 times," he writes on the firm's website. "The market has continued to rise in all but eight of those years. The average increase between September and year-end has been 3.9 percent."

The S&P 500 has risen 8.2 percent this year, excluding dividends. A 3.9 percent gain from Wednesday's close of 2,000.12 would leave the index at 2,078.

Editor’s Note: 5 Shocking Reasons the Dow Will Hit 60,000

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