After years of absorbing one punishing body blow after another as the market continued its free fall, affluent investors are finally starting to regain their confidence and invest accordingly, according to a new survey from Spectrem Group, a Chicago-based strategic consulting firm specializing in the affluent and retirement markets.
Its Spectrem Millionaire Investor Confidence Index rose 15 points in February to 17, the second-largest, one-month increase in index history.
The long and the short of this uptick in enthusiasm for the market, based on 250 interviews with the financial decision-makers in households with $500,000 or more in investable assets, is that the well-to-do are "mildly bullish" as a group, something they haven't been in a long time.
"Millionaires' investment confidence surged in February to its highest level in more than three years, returning to mildly bullish territory for the first time since the recession," Spectrem Group President George Walper, Jr., said in the report.
This is particularly good news for independent financial advisors looking to capitalize on some of the missteps made by their counterparts in the mass-affluent market by offering a more personalized and well-rounded service rather than routing these 13 million-plus investors with between $50,000 and $250,000 in investable assets to call centers.
In February, the Spectrem Affluent Investor Confidence Index moved up 7 points to what the consultancy characterizes as a "neutral" rating of 4, up from -3 last month and much higher than the -16 rating garnered in September.
"Confidence also rose among the broader affluent population," Walper added. "With considerably more attention focused on events abroad than domestic economic issues, America's wealthiest investors appear to be moving past their lingering post-recession concerns."
According to the survey, international problems -- presumably the unrest and uprising in Egypt, specifically -- were identified by 29% of respondents as the news story or event most affecting their economic outlook this month.
After that, it was a hodgepodge with the political environment (9%), unemployment (8%), health care reform (7%), the economy (6%) and stock market conditions (5%) straggling along as other key factors influencing their overall financial mindset.
In the past year, the Dow Jones Industrial average is up more than 18% while NASDAQ and the Standard & Poor's 500 Index have enjoyed increases of 26% and 20%, respectively.