“Basically, the stock market is very unstable,” said Leo Spadafora, 60, a salesman in Glens Falls, New York. Mr. Spadafora, who owns retirement accounts, said his portfolio has suffered about a 4 percent drop in value this year, its worst performance since 2009.
“A year ago, we were talking about a bull market,” he said. “And in 2016, it was about the second year of bull market when the market started to fall.” In an e-mail exchange, he added, “We’re nervous about being greedy.”
When markets are rising, it is viewed as a good thing. But the vast majority of investment experts believe there is some value left in the stock market, the economy and the world economy. The vast majority think economic growth will continue.
But about 4 in 10 Americans still regard the stock market as risky, even though the stock market has risen this year by more than 10 percent, passing the typical measure of a bull market. And about 2 in 10 see a stock market crash as possible, the highest percentage in two decades.
Indeed, it is investors who have created market psychology around stock values. Since the bull market began in early 2009, stock market analysts have tended to see bear markets as more likely, by flipping a coin or drawing a line under an investor’s hair.
Other evidence for market complacency: Among analysts, forecasts for growth this year have been at levels around average.
The fact that there are many people who still believe a stock market crash is possible explains why stock prices have risen so dramatically. On Thursday, the Dow Jones industrial average rose by 450 points, its seventh gain in the past nine days.
The strong market returns may also obscure some key shifts, including the dominance of technology companies, which are not so much driving the broader economy as they once were. In addition, many people have said for years that they were worried that the stock market was still overvalued. And the top 10 fund managers outranked the top 80 individual investors by a margin of 21 percentage points in the three months ending Sept. 30, marking the first time that has happened since the fund managers’ records began more than a decade ago.