Well-Off Investors Feeling Less Bullish

Well-heeled investors have been feeling worse about financial markets as this year has progressed.

Investment optimism among U.S. millionaires polled monthly by Chicago-based consultants Spectrem Group fell in September to a new low as uncertainty over the economy, terrorism and the presidential election clouded their outlook.

The Spectrem millionaire index, which measures the investment outlook of about 100 households with assets of $1 million or more to invest, recorded its third straight decline and hit the lowest level since the index was started in February.

Its sister index, the broader Spectrem affluent investor index, which since February has polled 250 households with $500,000 or more in assets to invest, also recorded its third straight decline, edging closer to bearish territory.

“Millionaires have been measurably more optimistic than affluent investors through the bulk of this year” and only now are “losing their last hint of bullishness,” said George H. Walper Jr., president of Spectrem Group, in announcing the results this week.

Spectrem Group is a consulting firm specializing in the affluent and retirement markets.

“When asked about the most serious threats to their financial goals, these millionaires expressed far more concern about terrorism than affluent investors as a whole -- with terrorism ranking behind only economic performance,” Walper said.

“If news from the Middle East is starting to take such a toll on this generally more patient and positive group, it is not at all clear that sentiment will rebound once the November election is behind us.”

In response to the open-ended question about the biggest threat to their household financial goals, the millionaires surveyed cited their key concerns, in order, as the economy, terrorism, the presidential election, unemployment, stock market performance and household income.

By contrast, the broader affluent investor group ranked the economy, the election and unemployment as greater concerns than terrorism.

The millionaire index recorded a new low of 7, a sentiment considered neutral, in September; that was down from 13, or mildly bullish, in August. The broader affluent investor index also hit a new low at 4, down from 5 in August. The index scale is 1 to 100, with 100 the most bullish possible reading.

The indexes are based on 250 10-minute telephone interviews each month.