How advisors feel about the markets generally and globally
While we always ask advisors their general market views in the Russell’s Financial Professional Outlook, this quarter we specifically addressed global investing, including sentiment on emerging and international developed markets, in a survey conducted between July 31, 2012 and August 14, 2012. It was an interesting exercise. We learned that advisors’ feelings about the emerging markets tracked very closely to their general market sentiment (see Figure 1 below).
However, it was a different story for international developed markets. Here advisors indicated that they were far less optimistic (39% optimistic versus 68% optimistic for overall markets), and 59% said they believe clients were downright pessimistic about international developed markets.
The spread between advisor and client sentiment is wide, but not unexpected. When it comes to the markets, investors appear frustrated with political uncertainty, the fiscal cliff and the lack of progress in Washington and Europe. Clients are approaching advisors with questions about government policies instead of focusing on asset allocation and rebalancing.