Asian investor confidence index jumped to 98.9 in November

But global confidence index fell.

State Street Global Exchange today released the results of the State Street Investor Confidence Index (ICI) for November 2013.

The North American ICI increased by 3.2 points to 89.4 over the revised October value of 86.2 and the Asian ICI rose 3.4 points to finish at 98.9 from an October revised value of 95.5.

The Global ICI fell to 91.3 in November, down 4.2 points from October’s revised reading of 95.5. The decline was
the result of a relatively steep fall off in European sentiment to 101.5 from a revised reading of 111.3 in October.
Sentiment in both North America and Asia improved slightly over the month fueled by better economic news out of both regions.

The Investor Confidence Index was developed by State Street Associates, State Street Global Exchange’s research and advisory services business, and Harvard University professor Kenneth Froot. It 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.

“Improved US economic data and consensus around the Yellen nomination implying delayed tapering seem to be leading to an uptick in North American investor confidence,” commented Ken Froot.

“Investors in the US are still aware of the challenges and overall confidence reflects this as sentiment has yet to return to a more neutral stance.”

“Our readings this month are in direct contrast to those in October,” added Jessica Donohue, head of research and advisory at State Street Global Exchange.

“European confidence, which clocked in at its highest level since July 2007 last month, has retrenched to near neutral territory driven primarily by weaker sentiment for the UK.”