Active Investors Confident in Market Growth, Fidelity Finds

During a Fidelity Traders Summit, roughly 1,200 Fidelity customers—mostly active investors—answered questions about their expectations for the Standard & Poor’s (S&P) 500 Index.

Three quarters (77%) predicted the index will hold steady or rise to at least 1,758 by 2014. Active investors anticipate roughly matching this growth—83% of active investors believe they will match or beat the S&P 500 in the next 12 months, and 73% expect a personal return of at least 6%. More than half (57%) reported having a defined trading strategy, but, of those, 41% follow their strategy only occasionally.

Other key findings of the poll include the following:

• Seventy-one percent of respondents said they would put their next investing dollar into equities, followed by cash (12%) and real estate (7%);
• Active investors are most bullish about health care (34%), information technology (21%) and energy (20%);
• Roughly half of active investors (48%) said they matched or beat the S&P 500’s 20% market gains of the last 12 months;
• Of respondents who employ a hedging strategy—43% do not—their top three investments are bonds (35%), options (31%) and conditional orders (20%); and
• Regarding the recent rise in bond prices, most were unhappy (41%, due to losses) or neutral (39%), but 20% saw this as an opportunity.

The poll was conducted on August 27 and included both in-person and webcast attendees. Active investors are defined as those who trade 36 times or more every year.