Chart Of The Day: Mom & Pop Cash Levels Fall To Lowest Since 2000

Ok, so we know retail investors are bullish, right?

Indeed, if the latest readings on Yale’s one-year investor confidence indices (so, percentage of respondents who think the Dow will be higher a year from now), are any indication, both the “smart” money and the “dumb” money are now 100% confident that nothing can go wrong. The actual number for individual respondents was 98.92.

Well, consider that along with these fun factoids from the latest AAII individual investor asset allocation survey:

  • Cash allocations fell 1.8 percentage points to 14.5% in July. 
  • This is the smallest allocation to cash since January 2000 (14.0%).
  • July was the 68th consecutive month that cash allocations were below their historical average of 23.5%.

What does that look like, you ask? It looks like this:


“Comparisons to the dot-com bubble are usually overblown but one comparison does catch my eye: the allocation of cash by retail investors, according to AAII’s survey, is at the lowest level since right near the peak of the dot-com bubble in 2000,” Bloomberg’s Michael Regan wrote this afternoon.

And while this doesn’t necessarily portend an imminent disaster, it is further evidence of euphoria and J.C. O’Hara at FBN Securities wrote this week, “retail dry powder is at levels that have historically occurred near intermediate term market tops.”

Nothing further.


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