Here's a paradox that is affecting the mind-set of today's investors: They are more optimistic about the stock market than they’ve been in nine years, since before the market collapse of 2008-09. But at the same time, they’re also moving more money into cash and CDs.
The latest Wells Fargo/Gallup Investor and Retirement Optimism Index gained 11 percent in the third quarter. Slightly more than half of investors are now “very” or “somewhat” optimistic about the 12-month outlook for markets, up from 42 percent last quarter.
But an almost equal percentage of respondents are more worried about stock market volatility than low interest rates, and 43 percent reported they have moved money to cash or cash equivalent savings over the past year. That’s substantially higher than the 29 percent who moved funds into individual stocks or stock funds.