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As a politically tumultuous 2006 drew to a close, both the Affluent and Millionaire Indexes continued their upward climb, with both rising into mildly bullish territory for the first time since February of 2006.
The Spectrem Millionaire Investor Index, a measure of the sentiment of households that have at least $1 million in investable assets, went up three points since November. Additionally, the Spectrem Affluent Investor Index, a measure of the sentiment of households that have at least $500,000 of investable assets, increased three points after declining the previous month.
Though the economy is still perceived as weak, those indicating intentions not to invest dropped to the lowest index point of the year, suggesting a resurgence in investing activity. This is supported by indicators that show stock investing is up, with stock mutual fund investing challenging the high point of 36.4 in March 2006 (p. 4). And in spite of the perception of a frail economy, millionaires are leading the more timid non-millionaires back into equity markets.
Notably, a trickling down of optimism has brought the Indexes to the closest they have been all year, with the confidence of millionaires pulling up the spirits of the affluent, just in time for 2007.Overall, the combination of political change and perceived economic weakness, not surprisingly has resulted in a degree of uncertainty reflected in the slow climb of the indexes.
Understandably, from 3rd quarter to 4th quarter 2006, the notable changes in how affluent households perceive threats to their financial goals was reflected in higher concern about the economy and political climate (p. 6).
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High Net Worth Advisor Insights Newsletter April 2008
