LIVE MARKETS-Stocks vs. Cash: An AAII gauge worth watching

Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com

STOCKS VS. CASH: AN AAII GAUGE WORTH WATCHING

The American Association of Individual Investors (AAII) conducts a weekly survey tracking members’ stock market sentiment, which is widely followed as a contrarian indicator. In its latest reading, investors continue to show pronounced pessimism toward stocks.

AAII also publishes a monthly asset allocation survey, measuring how members divide their portfolios among stocks, bonds and cash. This data offers another lens on retail investor behavior, highlighting how investors adjust exposure across asset classes as market conditions change. Like the sentiment survey, shifts in allocation can also carry contrarian implications.

Here is AAII's most recent allocation data for March as well as February's numbers.

The most recent peak in equity exposure occurred in November 2025, when stock allocations reached 71.2%, the highest since late 2021. That earlier peak essentially coincided with then-record highs in several major U.S. indexes, which were followed by bear markets in 2022.

With March’s shifts, the ratio of stock to cash holdings fell to 4.61 from 4.89 in February, as investors trimmed risk amid geopolitical tensions. Although timing signals can be imprecise, peaks in this ratio have often preceded periods of market instability over the past decade or so.

(Terence Gabriel)

EARLIER ON LIVE MARKETS:

SERVICES SHIFT INTO GEAR, LABOR MARKET IDLES CLICK HERE

WALL STREET INDEXES RISE EARLY AS INVESTORS WATCH MIDDLE EAST DEVELOPMENTS CLICK HERE

ROBOTS RISE, ROOKIES SLIDE: GOLDMAN SACHS BREAKS DOWN AI'S JOB IMPACT CLICK HERE

BULLS EYE 200-DMA RECLAIM AS DOW BOUNCES FROM CORRECTION LOW CLICK HERE