While U.S. markets continued their bullish run in May, confidence among wealthy investors plummeted, according to Spectrem's Millionaire Investor Confidence Index.
The Spectrem Millionaire Investor Confidence Index (SMICI) experienced a drop of 17 points in one month, falling from the four-year high of 20 in April to 3, the largest monthly drop in its 13-year history.
Spectrem attributes this drop to the political atmosphere and the lack of cohesive government.
"Even though the stock market remains at near-record high levels, millionaire investors are becoming increasingly cautious," said Spectrem President George H. Walper Jr in a statement. "This is likely due to growing concerns about the weakening political position of President Trump given recent controversies, the declining likelihood of substantive tax reform in the near term, as well as concerns about the recently submitted proposed federal budget. Although non-millionaires also recorded a drop in confidence, the fact they are slightly more confident now than millionaires is a strong indication that we may be entering a tumultuous period for investors."
The Spectrem Affluent Investor Confidence Index (SAICI) declined four points to 6. It is the first time the SAICI has eclipsed the millionaire index since May 2011.
The monthly Spectrem Affluent Investor Confidence index tracks changes in investment sentiment among the 17 million households in America with more than $500,000 of investable assets. The Spectrem Millionaire Investors Confidence Index (SMICI) reflects the investment sentiment of households with more than $1 million in investable assets. The May fielding was conducted from May 19 to May 23.
