State Street Global Markets released the results of the State Street Investor Confidence Index® (ICI) for October 2021. The Global Investor Confidence Index increased to 114.4, a rise of 8.4 points from September’s revised reading of 106.0. The increase in investor confidence was led by North American ICI, which rose 8.0 points to 144.0. Asian ICI was up a more modest 5.5 points to 103.1, and European ICI ticked up 1.2 points to 96.8.

“ Investor sentiment surged higher in October as the Global ICI hit its highest level in over three years,” commented Rajeev Bhargava, head of Investor Behavior Research, State Street Associates. “The uptick in risk appetite was evident broadly across three regions, with the US witnessing the largest rise, potentially motivated by declining COVID infection rates locally.

However, even with the improving virus situation and the gains witnessed recently in investor confidence, concerns over spillover effects from a China slowdown on other economies is an important risk we will continue to monitor as it could have negative impact on investor confidence in the upcoming months.”

*The Investor Confidence Index (ICI) was developed at State Street Associates, State Street Global Markets’s research and advisory services business, in partnership with FDO Partners. 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.