click for ginormous chart

Source: AAII, Fusion Analytics


Today, lets look at another interesting data point from AAII: Cash allocations reached a 16-month high in March. Individual investors pulled money from both equities and bonds last month.

We have shown the flip side of this chart in the past — equity allocation — which is similarly moderate.

Equity allocations fell 3.0 percentage points to 59.5% in March. Surprisingly, the past 15 months have not seen much variation in equity allocations stuck in a range from 58.8% (June 2012) to 62.5% (February 2013). The historical average is 60%.

March AAII Asset Allocation Survey results:

• Stocks Total: 59.5%, down 3.0 percentage points
• Bonds Total: 17.7%, down 1.5 percentage points
• Cash: 22.8%, up 4.6 percentage points

Historical Averages:

• Stocks/Stock Funds: 60%
• Bonds/Bond Funds: 16%
• Cash: 24%


Category: Apprenticed Investor, Investing, Sentiment

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

7 Responses to “AAII: Cash Allocations at a 16-Month High”

  1. goodieshunter says:

    Barry, what do you make of the high level of margin debt in NYSE brokerage accounts?

    Josh had a piece out last week with a chart.

  2. b_thunder says:

    Please help me reconcile:
    1. Cash allocations reached a 16-month high in March; “Stocks Total: 59.5%, down 3.0 percentage points”
    2) Stock market grinding higher for many months and is hitting one all-time nominal high after another

    How much longer both can happen simultaneously? Or are the conspiracy theorists correct and w./out monthly $85B from the Fed this market has nowhere to go but down ?

  3. techy says:

    b_thunder: If all this cash was in stocks, we would have been much more higher.

    I am curious about something: say 60=stocks and 10= cash, all over the world. now if you sell stocks to raise cash, somebody buys it, how can then stock be less than what it was and cash is more than before?

    Except that it is possible that naked short creates excess cash?

  4. The Window Washer says:

    Techy the nominal value of the stocks being held is based on the sale of the last share. So if someone buys a $9 stock for $10 and there is a billion shares the sale increased the value of stock holding in the world by billion.

    the fact that you typed the words “naked short” also makes people around here presume yours is a BS comment.

  5. constantnormal says:

    What does this say about the likelihood of a summer “sell in May” swoon?

    I take it as indicating that any sell-offs will be muted, and there could be some decent brief rallies over the summer.

    A lotta folks sold oodles at the end of last year, taking long-standing capital gains in the face of expected stiff tax hikes (which did not really occur), and despite the bull run to date, I don”t believe a lot of that cash has been put back to work, prolly due to deep and enduring (and understandable) confusion about where things are going.

    BTW, I have no hard data to support these statements, just my perceptions … which are almost as good as a coin flip.

  6. [...] AAII: Cash Allocations at a 16-Month High (The Big Picture) [...]

  7. [...] Lots of people have been discussing how negative investor sentiment is, showing the chart above. It revelas markets making all time highs as expectations that markets will be higher six months hence at a mere 19% of AAII respondents. (See Individual Investors Are An Emotional Wreck And It Is Astonishingly Bullish, Investors are Liars, and AAII: Cash Allocations at a 16-Month High). [...]