AAII Sentiment Survey, 4/16/25
BEARISH remained the top sentiment (56.9%, very high) & neutral remained the bottom sentiment (17.7%, very low); bullish remained the middle sentiment (25.4%, low); Bull-Bear Spread was -31.4%* (very low). Investor concerns: Tariffs, jobs, inflation, recession, Fed, budget, debt, dollar, geopolitical, Russia-Ukraine (164+ weeks), Israel-Hamas (67+3 weeks). For the Survey week (Th-Wed), stocks down, bonds flat, oil up, gold up sharply, dollar down. NYSE %Above 50-dMA 17.61% (oversold). New trade deals remain pending. US-China trade relations worsened. #AAII #Sentiment #Markets
Sentiments are CONTRARIAN indicators.
*Negative since 2/5/25.
https://ybbpersonalfinance.proboards.com/post/1955/thread
Comments
What @Junkster stated that the longest stretch is unusual. My interpretation is that we have not reached the bottom and they is more to come such as the continuing falling dollar against other major currencies.
I believe we'll continue to experience heightened market volatility
until there is some policy clarity from the administration.
This? At the top of the Risk Management Tools/Techniques ladder is Avoidance.
It is very effective almost all times, and is arguably very appropriate "...in uncharted territory like sailing in fogging conditions near the rocks."
Yeah, there were a lot of detractors on this forum when rates were topping out and as I was posting regularly about the merits of building a 5-yr, CP CD ladder paying over 5%.
I'm sure they're still out there. I guess the question would be who amongst them wouldn't trade at least a sleeve or two of their portfolios for one now.
To answer that though, they would need to know how much LESS fear, uncertainty, angst all the rest they'd be experiencing IF they owned one since Election or Inauguration Day. I can tell them - it's a LOT!
And it ain't too late to build one paying 4.0%. Just sayin'.
Edit. The money market fund above is SNAXX
I think the extreme pessimism is highly warranted and appropriate now and for the next 3 years, 9 months, if he manages to hold the office to term.
We're only three months in and he's already managed to bring markets and economies to the brink of destruction. And he now had Powell in his cross-hairs in an attempt to save his insane fiscal policies.
With all than, AND having endured his 1.0 act, IMO, we are effectively sitting on a ticking time bomb.
capecod, former major league bond trader, CEF savant, and one of the most legendary investment forum posters of all-time, also has a different take. Though he would likely never invest in a CD, he always has regarded (paraphrasing) "meaningful diversification as investment in anything that guarantees a positive total return."
If I scope all taxable bond OEFs available at Fido, I find there are 1802 splattered over 19 pages. If I sort them by "Worst to Best" performance for example 5 years, I find there are 12.5/19 pages that have TRs of LESS than the APY of my 5-yr CD ladder. 3 years, 15.5/19 pages with TRs LESS than.
That ain't "meaningful diversification" to me.
So, to an investor like me, who regards bonds pretty much as a 4-letter word and at one time, a necessary evil, I decided to AVOID dedicated bond funds after their last great crash, except for some small toeholds in 3 low risk finds that I recently bought with stock sale proceeds.
So basically in the past coupla years I exchanged our dedicated bond fund allocation for a 5-yr CD ladder.
I don't have to "hope" (as, IMO, most average bond fund investor do, yourself of course excluded) for annual TRs of 4%-5% from that sleeve. I don't have to "hope' the bond funds I select will be in the minority of dedicated bond funds that outperform my CD ladder. I get 5+% guaranteed, FDIC'd, with Rolex-clocklike interest payments, and full return of my principal at maturity.
And if history at least rhymes, our CD ladder will outperform over time, over 50% of all bond funds available at Fido. Meanwhile, we will, as always, continue to make our real investment money in stocks.
Maybe I misunderstood you, but if not, how is this strategy NOT investing? By definition, we're committing money to earn a financial return.
Just pity me because although a long time conservative moderate Republican meaning non MAGA, I have to deal with them daily here in rural KY including my long time lady friend. So why do I choose to live here? Something @Hank alluded to when describing his sojourn into West Virginia. They are the nicest, most friendly, down to earth people I have ever met. And I have lived all over the U.S. Odd, but personality and temperament wise they seem to have nothing in common with our President. Just don’t understand their attraction to him as their values don’t seem to align with his.
On bonds a discussion for another time.