US Stock Ownership Remains Low Despite Roaring Markets

Rarely a day goes by when the three major US market indexes don't set multi-year or all-time highs.

The S+P 500 and DJIA are currently breaking all-time records while the NASDAQ is the highest that its been since shortly after the dot-com bubble popped in 2000. If you are invested in stocks, chances are that you have a big smile on your face every time you check to see how your portfolio is doing.

You would think, given the way that the markets are surging, that ownership of stocks in the United States would be at an all-time high.

According to Gallup.com, this isn't even close to being the case.

As a matter of fact, the number of US adults who are currently invested in the stock market is sitting at a 15-year low. Gallup's data only goes back to 1998, so we'd probably have to go back 20 or 30 years before we found a year when ownership of US stocks was as low as it is now.

According to Gallup.com, 52% of US adults have money invested in the stock market (individual stocks, stock mutual fund, self-directed 401(k) or IRA). This is down slightly from last year (53%).

The "Great Recession" did a number on Americans who owned stocks - in 2007, 65% of US adults owned stocks. Over the next six years, this number would fall by a full 13%.

There are a number of reasons for this, including:

1) The dramatic drop in equities following the start of the "Great Recession" permanently scared many people away from the markets.

2) Continued high unemployment rates mean that many average Americans simply don't have the funds to get involved in the markets.

3) A healthy real estate market prior to the "Great Recession" had many Americans feeling flush and ready to invest.

4) Many people believe that they have missed the major move in the markets and are afraid to jump in at this stage of the game.

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Until the national unemployment returns to "normal" levels, I wouldn't expect the trend of falling US ownership of stocks to reverse itself anytime soon.

Source: Gallup.com - U.S. Stock Ownership Stays at Record Low

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