Bringing you live news and features since 2006 

Ken Froot

Investor confidence down by 5.7 points in September

RELATED TOPICS​

The State Street Global Investor Confidence Index decreased to 88.3 in September, down 5.7 points from August’s revised reading of 94.0. Confidence among North American investors further declined, with the North American ICI decreasing from 92.0 to 84.5.

The Asian ICI also decreased by 2.5 points to 100.0. Meanwhile, the European ICI rose by 1.0 points to 101.0.
 
The Investor Confidence Index was developed by Kenneth Froot (pictured), and Paul O’Connell at State Street Associates, State Street Global Exchange’s research and advisory services business. It measures investor confidence or risk appetite quantitatively by analysing the actual buying and selling patterns of institutional investors.
 
The index assigns a precise meaning to changes in investor risk appetite: the greater the percentage allocation to equities, the higher risk appetite or confidence. A reading of 100 is neutral; it is the level at which investors are neither increasing nor decreasing their long-term allocations to risky assets. The index differs from survey-based measures in that it is based on the actual trades, as opposed to opinions, of institutional investors.
 
“Institutional investor scepticism was particularly acute in North America, where elevated stock valuations and rising concerns about a slowdown in corporate earnings growth increased risk aversion. Furthermore, the escalation of the trade dispute between the US and China seems to have led to a decline in the North American ICI to the levels not seen since 2012,” says Froot.
 
“While US equity markets continue to break records, helping measures of business and consumer confidence through, or to, cyclical highs, institutional investors are becoming increasingly cautious,” says Michael Metcalfe, senior managing director and head of Global Macro Strategy, State Street Global Markets. “Institutional investors have reduced their holdings of risky assets for two months in a row, and taken our investor confidence index to its lowest level in more than five-years. The implication would appear to be that investors think, for the moment at least, all the good news is in the price.”

Latest News

US ETF issuers of active ETFs are facing an increase in fees from the big custodian firms, such as Charles..
ETF data consultant ETFGI reports that assets invested in the global ETF industry reached a new record of USD12.71 trillion..
Calastone has published an ETF white paper which examines several of the processes that take place across the lifecycle of..
Adapting product lines to fit into changing methodologies and meet shifting demand is essential to remaining relevant in the industry..

Related Articles

Taylor Krystkowiak, Themes ETFs
Themes ETFs opened its doors in December 2023, with an introductory suite of 11 ETFs – seven thematic and four...
Konrad Sippel, Solactive
At the end of March, financial index specialist, Solactive, published its 2024 annual report on future trends.  ...
Lorraine Sereyjol-Garros, BNP Paribas
Following changes to the French Monetary and Financial Code and of the French market authority AMF’s General Regulation, it is...
Ed Rosenberg, Texas Capital
Texas Capital Bank first opened its doors back in December 1998 and nowadays offers wealth-management services, as well as commercial,...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by