Is there an index that measures millionaires' sentiment and whether they are optimistic or pessimistic? The answer is yes. It is called the Spectrem Millionaire Investor Index.
The next question naturally is: "So what are the millionaires thinking about the economy?" The news is not good. The index fell 18 points to a -20 in June, a record decline since the index was created in 2004. Plus the index fell 17 points in May. A range of -11 to -30 indicates a slightly bearish sentiment. It's likely that millionaires underwent a reality check after a bout of over optimism in May.
You may be asking how the index is calculated? Each month, 250 interviews are conducted of affluent households, 117 of which are millionaires. These interviews then form the basis for the index. The interviews revealed that the number of those not investing rose slightly, while those who preferred stocks, bonds, and mutual funds fell.
Millionaires cited three main areas of concern: the state of the economy, the political climate, and the threat of inflation.
The less rich, those worth $500,000 to a million, were even more bearish.
Yet, it should be noted that some millionaires remain optimistic for the long term. They are licking their wounds from the beating they took last year and are willing to rebuild their portfolios gradually.
Do you agree with the millionaires' sentiments about the market?
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