Nearly Half of Americans Say Volatile Markets Are Path to Quick Profit: AICPA Survey

So far this year, the U.S. stock market has been a financial roller coaster. It has not been unusual to see the Dow swing in both directions by hundreds of points. At the conclusion of the first quarter, the S&P 500 had already seen 23 days with 1% movements. That is nearly three times the number of days this occurred in all of 2017. It appears volatility has become the new norm.

Surprisingly, even with that significant increase in fluctuations, one-third of Americans (37%) characterized the financial markets during the first few months of 2018 as stable, according to a telephone survey in April of 1,014 U.S. adults conducted by The Harris Poll for the AICPA.

For many, increased market volatility may actually signal an opportunity. According to the survey, nearly half of U.S. adults (48%) believe that a volatile market gives them an easy opportunity to make a profit.

“Investing is not a get-rich-quick scheme and trying to time a volatile market with hopes for huge gains is a serious financial risk,” says Greg Anton, chairman of the AICPA’s National CPA Financial Literacy Commission. “Many people who enter the market looking for a quick buck find they can’t handle watching their investment lose value, which leads them to sell at a loss. For most people, seeking incremental gains over a longer time horizon is a safer, more sustainable approach.”

Highlights of the study:

  • 3 in 10 Americans involved in household investment decisions say they never research investment strategies and potential investment opportunities.
  • A third of Americans involved in household investment decisions say they typically make high-risk investments.
  • Nearly half of Americans are not familiar with cryptocurrencies such as Bitcoin, Ethereum and Litecoin.

Numerous free investor education resources can be found at the AICPA’s 360 Degrees of Financial Literacy website.