Tags: millionaires | Spectrem | invest | stock

Millionaires Veering Away From Stocks, Non-Millionaires Jumping in

By    |   Thursday, 05 December 2013 07:40 AM

Millionaires have become more leery of the stock market and are increasingly opting to keep their money on the sidelines, according to research and consulting firm Spectrem Group.

"Not invest" increased 2.4 points to 33.2, a three-month high, in Spectrem's monthly survey of investment preferences.

Stock mutual funds and stocks became less popular investment options for millionaires, dropping 5.3 points and 1.5 points, respectively. Millionaires also viewed bond mutual funds and bonds less favorably last month. Real estate, on the other hand, became more popular, registering the month’s largest month-to-month gain of 7.3 points.

Editor’s Note:
5 Reasons Stocks Will Collapse . . .

"Millionaires are concerned about the ability of the market to maintain the current record high levels," Spectrem President George Walper Jr. told CNBC, saying the wealthy investors are worried about the Federal Reserve shrinking its economic stimulus.

Millionaires' skepticism of stocks contrasted with feelings of affluent investors, defined as those with over $500,000 of investable assets, who continued to return to stocks.

Non-millionaire intention to invest in stocks jumped 15.1 points to 30.5, the highest reading since June, according to Spectrem. Stock mutual funds increased 11.1 points to 33, another five-month high.

Typically, non-millionaires are more likely than millionaires are to retreat from stocks when risks seem to increase, Spectrem notes. Yet non-millionaires were piling into stocks even though analysts cautioned that any number of events could have upended the rally, including the debt ceiling fight, the government shutdown and possible tapering of the Federal Reserve's stimulus.

Those who said they would continue to "not invest" dropped 15.5 points to 46.4, a four-month low, while cash dropped 4.1 points to 15.5, a six-month low. Real estate dropped 2.1 points to 6.1, bond mutual funds and bonds gained 2.5 points and 3.4 points, respectively.

Despite becoming leery of the ever-increasing stock market, millionaires are more confident about the overall economy, according to Spectrem Group's Millionaire Investor Confidence Index.

The Spectrem Affluent Investor Confidence Index increased 5 points in November for a reading of 1. The Spectrem Millionaire Investor Confidence Index improved 2 points to 10, the second-highest reading in the past 10 months.

Both indexes have improved dramatically in the past 12 months. Confidence was negative 13 for affluent investors in November 2012 and negative 6 for millionaires.

The battle over healthcare and news reports about the government's poor rollout of its healtcare.gov website had the most impact on affluent investors' attitudes, according to Spectrem.

Editor’s Note: 5 Reasons Stocks Will Collapse . . .

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Millionaires have become more leery of the stock market and are increasingly opting to keep their money on the sidelines, according to research and consulting firm Spectrem Group.
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2013-40-05
Thursday, 05 December 2013 07:40 AM
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