Rockville, MD, Sept. 26, 2011 (GLOBE NEWSWIRE) -- The Advisor Confidence Index (ACI), a benchmark that gauges advisor views on the U.S. economy and stock market, reports that advisor confidence in the economy and the stock market fell further in September, with the index sliding 6.78% to 91.67.
For the first time this year, all four components of the index declined, including advisors’ outlook for the stock market. Advisors responding to the survey appeared to be progressively more concerned about the global economy, and increasingly skeptical of U.S. monetary authorities’ handling of the U.S. market.
"Federal fiscal policy is a huge headwind to business and the economy," said Douglas Conoway, CFP, ChFC, of Wealth Management Group. "I expect stagnation until this changes."
Among the economic components of the ACI, advisors’ longer-term outlook suffered the most, slipping 8.45%. September’s decline followed a 6.33% drop in August.
"If past is prologue," said Paul Bennett with c5 Wealth Management, "additional fiscal stimulus will consist of short-term solutions that will prolong, maybe even exacerbate, the current economic woes we are experiencing."
With September’s decline, the ACI is down more than 25% across the last eight months. With the exception of a brief turn to the positive in July, the benchmark has been down every month since January.
| Current economic outlook | -0.38% |
| Six-month economic outlook | -7.39% |
| 12-month economic outlook | -8.45% |
| Stock market outlook | -9.52% |
The most notable change in sentiment this month was advisors’ outlook for stock prices, the only measure to move forward in August (+2.44%). The stock market component of the ACI fell 9.52% in September. Advisors, according to Kenny Landgraf of Kenjol Capital Management, are "worn out."
"It’s impossible to make a fundamental investment decision," says Landgraf. "Instead, we’re just creating bubbles in gold and Treasuries."
"The stock markets cannot continue to deny the realities of the world's economic crisis," said advisor Peter Wheeler. "The consumer is lost and governments are out of money. Bankers won't lend and businesses won't spend. Where does the next stimulus come from?"
Further Comments From Participating Advisors
"Unless policy makers can free the gridlock and do their jobs, the uncertain market environment will continue to breed fear and volatility."
Rob Siegmann, Financial Management Group
"We expect to see rough investing markets ahead as the global financial crisis continues."
Jim Elder, ElderAdo Financial
"With the sovereign debt issues, the situation in Europe could get ugly. The worse it gets, the larger the impact on the U.S."
Richard Coe, CFP, CLU, Coe Financial Services
About Advisor Confidence Index’s Methodology
The Advisor Confidence Index is a benchmark that gauges advisors’ views on the economy. Modeled after the Conference Board Consumer Confidence Index®, the ACI captures the sentiments of 150 independent registered investment advisors (RIAs). The index’s analysis is based on the number of completed surveys from September 9, 2011 through September 15, 2011, and reflects only information from those surveys. This information is intended to be general in nature, and these overviews are no substitute for professional, legal, or consulting advice. This information should not be construed as advice from Rydex|SGI Advisorbenchmarking, Inc. or any of its affiliates.
About Rydex|SGI AdvisorBenchmarking, an affiliate of Rydex|SGI
Rydex|SGI AdvisorBenchmarking is a research and analysis center focused on the registered investment advisor (RIA) marketplace. Every year through its survey website, www.AdvisorBenchmarking.com, the firm conducts multiple surveys of advisors, covering a host of business management and investment management practices. The findings and analysis of the data are then released to the marketplace as annual studies, quarterly research notes, monthly newsletters, and a confidence index. The service is aimed at helping advisors grow and enhance their firms by comparing how their businesses fare against other advisors. Advisors also learn best practices of the most successful advisors in the business. AdvisorBenchmarking is an affiliate of Rydex|SGI.
###