From the desk of Willie Delwiche.
When They All Look Higher, Watch Out Below
Young investors were swept away in the 2021 speculative bubble and came into 2022 with lofty expectations.
The Numbers: The University of Michigan Survey of Consumers shows that a record 70% of investors in the 18-34 age group came into 2022 expecting that stocks would rise over the course of the year. For the 35-54 age group it was 61% and for those 55+ it was 59%. As of August, all three groups were below 50%, with expectations among younger investors getting more in line with those who have been through more market cycles.
Why It Matters: Young investors are learning liquidity lessons in 2022 that are as important as they are painful. Investors of all ages are having to reckon with a less favorable backdrop going forward than persisted in recent years. While expectations for the year ahead are now off their extremes, they don’t look historically washed out at current levels.
In this week’s Sentiment Report we take a closer look at what investors are saying, what they are doing, how sentiment now looks like it did in March 2009, but also July 2008.
