Click to enlarge
Chart

Source: AAII, FusionIQ

 

Last week, we noted the US Equity markets have been outperforming the rest of the world by a huge margins (Spot the Outlier).

This may be contributing to circumstances where US investor allocations are overweight US equities, and underweight other asset classes.

In these circumstances, you might consider looking at Europe and Emerging markets, and (dare I say it) review your Bond Weightings.  I keep seeing portfolios that are underweight Corporate Bonds (which may be needed) as well as High Yield (but only if you have the risk tolerance for it).

Thanks to their price appreciation, As a percentage of holdings, Equities are no longer over Under-owned. However, as we saw in the 1990s, they are not excessively over-owned yet. This condition could go on for many years. . .

 

Category: Asset Allocation, Investing, Psychology

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.

6 Responses to “AAII Asset Allocation Survey (Equities) – Deviation from mean”

  1. GeorgeBurnsWasRight says:

    Barry,

    Did you perhaps mean to say in the last paragraph that “Equities are no longer UNDER-owned”?

  2. Tony61 says:

    “As a percentage of holdings, Equities are no longer over-owned.”

    Is this accurate? Maybe I’m misunderstanding the post.

  3. VennData says:

    The out-performance of US equities may continue next quarter, or two and possibly beyond. Or it may not.

    • Angryman1 says:

      Supply sided economics generally means yes to further “out-performance”. I think the history since the adoption of supply side economics would teach everybody that lesson by now.