Confidence Has Returned To Investors in Wake of Trump’s Election
$SPY, $DIA, $UBS
Just 2 weeks before the US Presidential election, 50% of wealthy investors were fearful of turmoil in the stock markets. Many either pulled some of their money out or moved it into more conservative investments, according to a survey by UBS Wealth Management Americas.
About 33% increased their cash holdings, and missed out on one of Wall Street’s most profitable rallies in years.
The Dow surged to record highs on Republican Donald Trump’s victory, and the S&P 500 financial index had its best week since October 2014.
When UBS surveyed the same 1,200 wealthy investors during the week after the November 8 election, optimism spiked with more than 50% of investors saying they expect positive returns from the S&P 500 over the next 6 months.
“The fear of the event was greater than the outcome of the event from a financial markets standpoint,” said the President of UBS Wealth Management Americas. “It was an emotional decision.”
The group surveyed was split between 33% Donald Trump supporters, 33% Hillary Clinton supporters, and 33% of participants who declined to say who they voted for.
After the election, 9 out of 10 investors said that Washington needed to change, and 2 out of 3 people said they believed Donald Trump to be a catalyst for change.
Wealthy investors preferred Donald Trump to his Democratic rival Hillary Clinton overall when it came to tackling their Top 3 concerns:
- the economy
- national security.
And 33% of all wealthy investors said they expect to pay less taxes in the Trump Administration
Donald Trump’s supporters were the most Bullish about the economy after the election, as 33% said they plan to increase their investments in the stock market and 25% expect they will increase personal spending.
More than 50% of Hillary Clinton supporters said the opposite, with 56% fearing an economic recession and 28% reporting they are increasing their cash holdings.
And 4 in 10 investors said they plan to change their portfolios based on their political preferences.
|HeffX-LTN Analysis for SPY:||Overall||Short||Intermediate||Long|
|Bullish (0.27)||Neutral (0.21)||Bullish (0.44)||Neutral (0.16)|
|HeffX-LTN Analysis for DIA:||Overall||Short||Intermediate||Long|
|Bullish (0.33)||Bullish (0.28)||Bullish (0.33)||Bullish (0.36)|
Have a terrific weekend.
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