Are investors still excited about the stock market? Or are they converting all of their investments into gold coins and hiding them under the mattress?
Fidelity Investments' traders say that things are looking up and that active investors are enthusiastic about both the S&P 500 index and their own investment choices, though they're also realistic about ways to make it in a low-yield environment.
Using the results of a poll conducted last month at the Fidelity Traders Summit, which included more than 2,000 participants who conduct more than 36 trades per year, the company's investors revealed the following:
- Bullish Outlook for the S&P 500 Index – Half (50 percent) of the active investors believe the S&P 500 Index will close the year up more than 100 points – to at least 1,459 – while one third (33 percent) believe it will stay within 100 points.
- Confident in Beating/Matching the Market – Sixty-two percent of active investors say they expect to beat the market during the next 12 months. Twenty-nine percent say they will match it.
- Next Investing Dollar Going into Stocks – Sixty-seven percent of active investors say they will put their next investing dollar into stocks. Ten percent say bonds while nine percent say real estate. Through March 2012, the number of Fidelity brokerage accounts holding common stocks grew seven percent year-over-year.
- Fewer Investors Beating/Matching the Market in Last Year – While two-thirds (67 percent) of active investors say their portfolio’s performance matched or beat the S&P’s performance over the last 12 months, this is down from 80 percent from a similar poll taken in May 2011.
- Top Investing Concerns – Active investors listed their top investing concerns as European markets (44 percent), followed by the November elections (30 percent).
- Dividend-Paying Stocks are Popular – To boost their returns in this current low-interest rate environment, 71 percent are primarily investing in dividend-paying stocks, while 11 percent are primarily investing in high-yield bonds.
- Technology and Energy Sectors in Favor – When asked what sectors had the most upside potential in the next six months, 35 percent chose Information Technology and 31 percent chose Energy. Health Care, at 12 percent, rounded out the top three.
- More Market Volatility Seen as an Opportunity by Some – Nearly half (45 percent) prefer more market volatility so they can more easily find investing bargains, while 55 percent see reduced market volatility as a safe time to invest more in the equity markets.