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Active Traders Express Optimism On Market Outlook

The majority of active traders believe that the market will close higher in both 2012 and 2013 despite expressing concerns going into last week’s Presidential election, according to data released today by Charles Schwab.

The latest Charles Schwab Active Trader Sentiment Survey polled participants in the Schwab Trader Day virtual event on October 20, 2012. While 24 percent of participating traders were concerned about the November 6 th election and 55 percent give the government a grade of D or F for their pursuit of policies that encourage investing, they say their long-term outlook remains positive. Nearly 60 percent of traders think that the stock market will close higher in 2012, and 54 percent say the same about their outlook for 2013.

“Traders have real concerns about a broad range of issues that are impacting the national and international markets. They also believe that there are better times ahead in the coming months,” said Kelli Keough, Senior Vice President at Charles Schwab. “We’re encouraged to see that this positive sentiment is starting to be reflected in their actions – nearly a quarter of traders surveyed say they have reduced the cash allocation in their portfolio in the past three months.”

Other key findings of the survey include:
  • The fiscal cliff tops the list of trader concerns. Twenty-seven percent of traders say that the fiscal cliff is their top issue of concern for the market. While the election followed at 24 percent, unemployment is the top concern for 16 percent of traders. Low on the list of top concerns are interest rates (3 percent), the housing market (3 percent) and energy prices (2 percent).
  • Traders see upside in sectors. Traders are most bullish on the energy (20 percent), healthcare (17 percent) and technology sectors (16 percent). Financials and consumer discretionary sectors are next on the list of where traders see opportunities.
  • International investing remains attractive. A third of traders say they see better growth opportunities outside the U.S., and nearly 80 percent are interested in global investing.

Schwab provides active traders with cutting-edge trading platforms, free seminars and workshops, online education resources and 24-hour access to experienced trading specialists, now with no minimum trade requirements. For more information, please visit www.schwab.com/AT or call 800-435-9050.

Survey Methodology

Data from the Charles Schwab Active Trader Sentiment Survey were derived from responses of 325 virtual attendees of the Schwab Trader Day, collected on October 20, 2012, and analyzed by Directive Analytics.

About the traders surveyed

Attendees of the Schwab Trader Day virtual event in October were from 48 states across the country and 54 percent of attendees were over the age of 55. Half of respondents indicated that they actively trade 20 percent or less of their portfolio. Thirty-eight percent identified themselves as options traders and 62 percent said they owned non-U.S. equities.

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