US Strategists' Recommended Stock and Bond Allocations

Bloomberg's recent strategist survey showed a decrease in the recommended allocation for stocks.  The consensus weighting for equities has dropped from 66% in the last week of May to its current level of 62.5%.  This may not seem like much, but a look at the historical chart shows that it is a pretty significant move.  The decreased allocation for stocks has been accompanied by an increase in the allocation for bonds.  The strategists' allocation for fixed income has moved from 22.8% to 25.5% over the same time period.

These historical allocation charts also show that strategists have changed their "approach" towards the markets in recent years.  In the late 90s and early part of this century, they seemed to be herd followers -- increasing their allocations into assets as their prices moved higher and vice versa.  In the last two or three years, however, strategists have stuck to their guns and held their allocations fairly stable, even as equities have risen quite a bit.