Americans are Bullish on Stocks, Should You Be?

By Rayhanbp @ Adobe Stock

The stock market has minted millionaires this year, reports Gunjan Banjerji in The Wall Street Journal. That’s not bad, but Americans, as Banerji explains, “have rarely been this giddy about the stock market.” Banerji writes:

U.S. households’ stock allocations have steadily inched up this year, according to JPMorgan estimates, and recently accounted for around 42% of their total financial assets. That is the most on record in data going back to 1952.

And investors are still feeling good about the market. At a time when many people have been stung by higher prices for eggs, bread and other household staples, the stock market has offered a real-time barometer of their rising wealth. The S&P 500 has hit more than three dozen fresh records this year, on pace for the most in a calendar year since 2021.

That has delighted those who have taken a peek at their portfolios.

“Was just going through my 401k and HOLY HELL what a God Send,” wrote Steve Ethridge on social-media platform X this month.

The 51-year-old said he has been steadily investing for years and poured more cash into the market over the past one after landing a raise at work.

The steady gains in his stock portfolio have made him feel better about his money than he has in a while. He isn’t too concerned about the recent market volatility.

“I do feel better off than I did a few years ago,” Ethridge said.

He isn’t alone. One measure of bullish sentiment among investors is hovering around its highest levels of the past year, according to the American Association of Individual Investors.

Of course, some investors see reasons to be cautious. September is often one of the most volatile months for markets, and turbulence could pick up around a contentious presidential election that has already been full of surprises.

Action Line: Households’ allocation to stocks is in rarefied air. That typically doesn’t end well. Be prepared. Consider the benefits of a balanced portfolio, and when you’re ready to talk about building your own, I’m here.

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E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zildjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West (RIP JB) and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com To sign up for my free monthly Survive & Thrive letter, click here.

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