May AAII Asset Allocation Survey: Pullback In Fixed-Income Exposure
Summary
- Individual investors' exposure to fixed income retreated in May from a 26-month high in April, with bond and bond fund allocations decreasing by 0.9 percentage points to 14.8%.
- Stock and stock fund allocations increased by 0.9 percentage points to 65.2%, remaining above their historical average for the 36th consecutive month.
- Cash allocations saw a small increase of 0.1 percentage points to 20.0%, staying below their historical average for the sixth consecutive month.
Dzmitry Skazau
Individual investors' exposure to fixed income pulled back in May, retreating from its 26-month high set in April 2023. The May AAII Asset Allocation Survey also shows slightly higher equity allocations and a small change in cash allocations.
Stock and stock fund allocations increased by 0.9 percentage points to 65.2%. The increase keeps stock and stock fund allocations above their historical average of 61.5% for the 36th consecutive month.
Bond and bond fund allocations decreased by 0.9 percentage points to 14.8%. May was the 27th consecutive month with fixed-income allocations below their historical average of 16.0%.
Cash allocations increased by a modest 0.1 percentage points to 20.0%. Cash allocations are below their historical average of 22.5% for the sixth consecutive month.
Pessimism in the weekly AAII Sentiment Survey pulled back from unusually high levels during the second half of May. Large-cap stocks-particularly large-cap growth-fared well during May. The gains in equity were not widespread, however, as mid-cap, small-cap and value stocks all declined.
May AAII Asset Allocation Survey results:
- Stocks and Stock Funds: 65.2%, up 0.9 percentage points.
- Bonds and Bond Funds: 14.8%, down 0.9 percentage points.
- Cash: 20.0%, up 0.1 percentage points.
May AAII Asset Allocation Survey details:
- Stocks: 33.6%, up 3.1 percentage points.
- Stock Funds: 31.6%, down 2.3 percentage points.
- Bonds: 4.3%, down 0.6 percentage points.
- Bond Funds: 10.6%, down 0.3 percentage points.
Historical averages:
- Stocks/Stock Funds: 61.5%.
- Bonds/Bond Funds: 16.0%.
- Cash: 22.5%.
The AAII Asset Allocation Survey has been conducted monthly since November 1987 and asks AAII members what percentage of their portfolios are allocated to stocks, stock funds, bonds, bond funds and cash. The survey and its results are available online at: https://www.aaii.com/investor-surveys.
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