Individual Investors Not As Bullish as Their Advisors

Following last Friday's announcement by the SEC that it was charging Goldman Sachs (GS) with fraud, many have made the argument that the events would drive the individual investor away from the market.  With Goldman being accused of misleading its own clients, the case seemed to provide further evidence that the deck is stacked against the individual investor.  If this week's survey from the American Association of Individual Investors (AAII) is any indication, then there is truth to the argument.  In the last week, bullish sentiment showed its largest single weekly decline since November, dropping from 48.5% to 38.1%.  Interestingly, the large drop in individual investor sentiment comes at the same time that newsletter writers, apparently unfazed by the SEC v. Goldman suit, turned even more bullish.

Subscribe to Bespoke Premium and gain access to Bespoke's unrivaled stock market commentary.