The American Association of Individual Investors (AAII) Sentiment Survey is a popular tool that helps investors measure the overall sentiment of individual investors in the stock market.
By providing insights into the market’s bullish, bearish, and neutral perspectives, the AAII Sentiment Survey can be a valuable resource for investors in understanding market trends.
What is the AAII Sentiment Survey?
The AAII Sentiment Survey is a weekly survey conducted by the American Association of Individual Investors, a non-profit organization dedicated to providing investment education and resources to individual investors.
The survey has been conducted since 1987 and polls AAII members on their outlook for the stock market over the next six months. Respondents can choose from three options: bullish, bearish, or neutral.
AAII members are asked to vote once a week, so the poll gives a clear picture of both short-term and long-term feelings, as well as changes in the survey data over time.
How to Use AAII Sentiment Survey
To understand the AAII Sentiment Survey results, consider the following:
- Bullish sentiment: The percentage of respondents who believe the stock market will rise over the next six months.
- Bearish sentiment: The percentage of respondents who think the stock market will fall over the next six months.
- Neutral sentiment: The percentage of respondents who expect the stock market to remain relatively unchanged over the next six months.
The survey results are typically presented as a percentage of the total respondents for each sentiment category. Additionally, historical averages for each sentiment are often included for comparison.
When you look at the actual surveys, it’s easy to see that a higher percentage of “bullish” answers means that more people think the market will go up, and vice versa.
Traders can also look at data from as far back as 1987, which gives them useful information for further research.
Why is the AAII Sentiment Survey important?
The AAII Sentiment Survey is important for several reasons:
- Investor sentiment: The survey offers insights into the mood of individual investors, helping to identify potential market trends and reversals.
- Contrarian indicator: Some investors use the AAII Sentiment Survey as a contrarian indicator, believing that extreme readings in either bullish or bearish sentiment may signal a potential reversal in market direction.
- Market analysis: By monitoring the survey results, investors can gain a better understanding of the factors influencing market sentiment and make more informed decisions about their investment strategies.
Who publishes the AAII Sentiment Survey?
The AAII Sentiment Survey is conducted and published by the American Association of Individual Investors.
The survey data is collected from the responses of AAII members who participate in the survey voluntarily.
Where can I find the AAII Sentiment Survey?
The AAII Sentiment Survey results are available to the public through the AAII website, typically updated every Thursday.
The website provides a summary of the latest survey results, including the percentage of respondents in each sentiment category, as well as historical averages for comparison.