Survey Shows Investors Have No Idea Where the Market is Headed
DataTrek conducted an investor survey that revealed most have no idea where the stock market goes from here, according to Market Insider.
The firm conducted the investor survey by asking "Where do you think the S&P 500 will end the year?
The responses were split across all possible scenarios and are listed below:
20 percent said the S&P 500 would be up over 10% from current levels
21 percent said the S&P 500 would be +5% to +10% from current levels (most popular by two votes)
21 percent said the S&P 500 would be within 5% up or down from current levels
18 percent said the S&P 500 would be down -5% to -10% from current levels
19 percent said the S&P 500 would be down more than 10% from current levels
According to DataTrek co-founder Nicholas Colas, the firm has never seen an investor survey when all possible scenarios "got basically the same number of votes, and we're only talking about the next 6 months."
Colas believes we are currently in a "conviction-less" market given the amount of uncertainty remaining in the coming months, referring to the surge of coronavirus cases in the US. On Tuesday, CNN's Fear and Greed Index registered a neutral rating of 48, furthering evidence against the lack of certainty with investors.
Investors do agree that US large cap stocks and technology stocks will outperform over the next six months. 38 percent of survey respondents chose US large cap stocks as the asset class they believed would perform best the remainder of 2020. 52 percent of respondents chose technology stocks in the US large-cap group. Colas believes that stocks will move higher despite the survey results.
"Our take has been that corporate profits are more knowable than economic conditions and equities should continue to rally after a several-week pause. But our survey results show many investors remain wary," Colas said.