NEW YORK — Concerns about the economy, terrorism and the upcoming U.S. presidential election gnawed at millionaires' investment attitudes last month, according to a recent survey.
The Spectrem Millionaire Index, which measures the investment outlook of affluent households with $1 million or more to invest, recorded its third straight decline in September and dropped to the lowest level since its inception in February 2004. The index is based on a scale of negative 100 to 100, with 0 marking the dividing line between bearish and bullish sentiments. Anything from negative 10 to 10 is considered to be within neutral territory. The Index fell to a neutral level of 7 last month — compared with 13 in August — after 7 consecutive months in mildly bullish territory.
Its sister index, the Spectrem Affluent Investor Index, which looks at households with $500,000 or more in investable assets, also recorded its third straight decline last month to a neutral level of 4, edging closer to bearish territory. It registered a 5 in August.
"Millionaires have been measurably more optimistic than affluent investors through the bulk of this year, only now losing their last hint of bullishness," said Spectrem president George H. Walper Jr. in a statement, adding that they also expressed far more concern about terrorism than the affluent group, ranking behind only economic performance.
"If news from the Middle East is starting to take such a toll on this generally more patient and positive group, it is not at all clear that sentiment will rebound once the November election is behind us," he added.
In response to an open-ended question about what poses the biggest threat to their household financial goals, 18 percent of respondents cited the economy as their top concern; followed by terrorism (which ranked first for 14 percent of respondents); the presidential election, 12 percent; unemployment, 9 percent; stock market performance, 7 percent; and household income, 6 percent.
In contrast, the broader affluent investor group ranked their top concerns in a different order, also starting with the economy, but followed by the election, unemployment, terrorism, the stock market and household income.
The Affluent Index is based on 250, 10-minute telephone interviews with the financial decision-makers of the households each month, giving the data a margin of error of plus or minus 6.2 percentage points. The Millionaire Index is based on a subset of the overall survey group, which can vary each month, but is typically drawn from more than 100 monthly interviews, the Chicago-based Spectrem said.