Investor Confidence Declined in January

The Global Investor Confidence Index decreased to 76.5, down 3.2 points from December’s revised reading of 79.7. The North American ICI fell 3.4 points to 68.2 and the European ICI dropped from 109.4 to 105.5, a 3.9 point decline. Meanwhile, the Asian ICI rose 4.8 points to 93.9. 
 
The Investor Confidence Index measures investor confidence or risk appetite quantitatively by analyzing the actual buying and selling patterns of institutional investors. The index assigns a precise meaning to changes in investor risk appetite: the greater the percentage allocation to equities, the higher risk appetite or confidence. A reading of 100 is neutral; it is the level at which investors are neither increasing nor decreasing their long-term allocations to risky assets. The index differs from survey-based measures in that it is based on the actual trades, as opposed to opinions, of institutional investors.