In a sign of blooming confidence among active traders, a new survey by Charles Schwab (NYSE:SCHW) shows many investors plan on bullishly reinvesting their tax refunds into the stock market.
The sentiment survey of more than 650 individual investors that trade frequently, at least 36 times a year, found that 72% of those expecting a tax refund this year plan on investing at least some of it in the market.
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Just over 25% of those polled said they intend on dumping the entire refund into their investment portfolios.
Overall optimism about market conditions hit its highest level since the end of 2009, according to the survey, which was conducted in March and April of this year. Nearly half of the surveyed traders said they are currently bullish, compared to just 38% last November and 28% in the year-earlier period.
“These survey results reinforce what we are already seeing among our client base,” noted Kelli Keough, vice president of active trading at Charles Schwab. “The trading platform is often the single biggest influence in how a trader perceives and reacts to market-making events.”
By sector, traders seem more bullish on the technology sector, followed by materials and traders, though with rising unrest in the Middle East that continues to shake oil prices, only 1% of investors said they were optimistic about the commodities sector.
The number of traders owning foreign stocks slid about 7% from November, a likely reflection of the unrest abroad and catastrophic March 11 earthquake and tsunami in Japan.
Despite global hiccups, the U.S. economy seems to be on the rebound, and one in four poll participants recently changed their portfolio allocation to include less cash, while 69% said they plan on making more than 36 trades this year.