(Reuters) – Stocks have more than doubled since the financial crisis and are closing in on a five-year high, but many Main Street investors have been absent from the party – especially those with the least saved.
Those who missed much of the rally did so because they reduced equity exposure after the benchmark S&P 500 index plummeted 57 percent between late 2007 and March 2009, according to an analysis by Reuters of mutual fund flows and changes in assets held in retirement accounts. Investors with the smallest savings typically saw the lowest percentage recovery in returns.
And while some have returned to the stock market during the subsequent rally, plenty of small investors remain on the sidelines.
“This is the most uncelebrated bull market in history,” said Tony Ferreira, managing director at Cogent Research, which provides research and consulting for large fund managers. “In the old days, people would be jumping on the bandwagon, but nobody’s chasing equity performance this time. Many people are still scared to wade back into the water.”
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