Sentiment & Survey Data for Investors: AAII, ISM, Expectations & More

Why Sentiment Data Matters

Sentiment surveys provide:

• Forward-looking indicators
• Real-time reads on conditions
• Contrarian trading signals
• Leading indicator properties

Unlike hard data (actual activity), sentiment measures expectations and attitudes.

Investor Sentiment Surveys

AAII Investor Sentiment

IQ Score: 92

American Association of Individual Investors.

What it measures:

• Bullish %
• Neutral %
• Bearish %

Release: Weekly (Thursdays)

Contrarian interpretation:

FRED Series: AAII Bull (calculated from survey)

Investors Intelligence

IQ Score: 91

Newsletter writer sentiment.

Measures:

• Bulls %
• Bears %
• Correction %

More sophisticated than retail surveys.

Often used for contrarian signals.

CNN Fear & Greed Index

Seven indicators combined:

• Stock price momentum
• Stock price strength
• Stock price breadth
• Put/call ratio
• Junk bond demand
• Market volatility
• Safe haven demand

Interpretation:

• 0-25: Extreme Fear
• 25-45: Fear
• 45-55: Neutral
• 55-75: Greed
• 75-100: Extreme Greed

NAAIM Exposure Index

IQ Score: 90

National Association of Active Investment Managers.

Measures: Equity exposure of active managers

Range: -200% to 200%

Contrarian use: Extreme low = buy signal

Business Sentiment Surveys

ISM Manufacturing PMI

FRED Series: MANEMP | IQ Score: 97

The gold standard business survey.

Components:

• New Orders (25%)
• Production (25%)
• Employment (20%)
• Supplier Deliveries (15%)
• Inventories (15%)

Interpretation:

ISM Services PMI

FRED Series: NMFCI | IQ Score: 96

Services = ~70% of economy.

Often more stable than manufacturing.

Regional Fed Surveys

These preview national ISM!

FRED example: DPROSENTFT (Dallas Fed general activity)

NFIB Small Business Optimism

FRED Series: NFIB | IQ Score: 94

National Federation of Independent Business.

Components:

• Earnings trends
• Sales expectations
• Hiring plans
• Capital expenditure plans
• Inventory satisfaction

Why it matters:

• Small business = most employment
• Leading indicator for hiring
• Credit conditions for SMEs

CEO Confidence Surveys

Conference Board CEO Confidence:

• Quarterly
• Large companies
• Leading for investment

Business Roundtable CEO Survey:

• Quarterly
• Capex and hiring plans
• Policy sentiment

Consumer Sentiment/Confidence

University of Michigan Consumer Sentiment

FRED Series: UMCSENT | IQ Score: 94

Components:

• Current conditions (50%)
• Expectations (50%)

Key feature: Includes inflation expectations (Fed watches closely)

Release: Preliminary (mid-month), Final (end-month)

Conference Board Consumer Confidence

IQ Score: 93

Components:

• Current conditions (40%)
• Expectations (60%)

Key feature: More employment-focused

Which to use:

• Michigan: Inflation expectations
• Conference Board: Short-term spending

Consumer Expectations Surveys

NY Fed Survey of Consumer Expectations:

• Inflation expectations
• Labor market expectations
• Spending intentions
• IQ Score: 93

ECB Consumer Expectations Survey:

• Euro area
• Similar coverage

Inflation Expectations Data

Market-Based

TIPS Breakevens:

• 5-year: T5YIE
• 10-year: T10YIE
• IQ Score: 95

Inflation Swaps:

• More liquid than TIPS
• Forward rates available

Survey-Based

Michigan 1-Year Expectations: MICH

Michigan 5-10 Year Expectations: MICH5Y

SPF (Survey of Professional Forecasters):

• Philadelphia Fed
• Quarterly
• Distribution of forecasts
• IQ Score: 94

Livingston Survey:

• Oldest US survey
• Semi-annual
• Professional forecasters

Using Sentiment as Contrarian Signals

When Extremes Work

Classic contrarian setup:

• Sentiment reaches extreme

• Positioning reflects extreme

• News flow is one-sided

• Price exhaustion evident

When Extremes Don't Work

• Trend can persist despite extremes
• "Climbing wall of worry"
• "Sliding down slope of hope"

Combining Indicators

More robust signals when multiple measures align:

• AAII bearish + CNN Fear extreme + NAAIM low = stronger buy signal

Building a Sentiment Dashboard

Weekly Monitoring

• AAII Sentiment: Individual investors

• CNN Fear/Greed: Quick read

• Put/Call ratios: Options positioning

Monthly Tracking

• ISM PMIs: Business conditions

• Consumer confidence: Both measures

• Regional Fed surveys: Early ISM read

• Inflation expectations: Policy implications

Quarterly Review

• CEO confidence
• NFIB small business
• SPF forecasts
• Bank lending surveys

Survey Data Best Practices

Understand the Methodology

• Sample size
• Question wording
• Historical revisions
• Seasonal adjustments

Track the Trend, Not Level

Direction often more important than absolute reading.

Consider the Context

• What's already priced in?
• What's the consensus view?
• Any special factors?

Cross-Check Multiple Sources

Surveys can disagree. Look for confirmation.

Pro Tips

• Regional Feds preview ISM: Trade early signals

• Extremes are rare: Don't call extreme lightly

• Sentiment is not timing: Direction, not entry point

• Michigan flash moves markets: Release time matters

• Business surveys lead: Consumer follows

• Inflation expectations self-fulfilling: Fed takes seriously

Explore sentiment data →