Investor Confidence Index Falls to 84.0 in SeptemberSeptember 2005 Investor Confidence Index(R) (Graphic: Business Wire)
September 20 2005 - 10:01AM
Business Wire
State Street Launches Regional Data Providing Insight into the Risk
Appetite of Institutional Investors in Europe, North America and
the Asia-Pacific Region State Street Global Markets, the investment
research and trading arm of State Street Corporation (NYSE:STT),
released today the results of the State Street Investor Confidence
Index(R) for September 2005. For the first time, State Street also
launched regional data for institutional investors in Europe, North
America and the Asia-Pacific region. According to the September
index, investor confidence decreased by 1.3 points from August's
revised reading of 85.3. North American institutional investors'
risk appetite registered at 99.4, compared to 69.4 for European
investors and 81.4 for institutional investors in Asia. Developed
through State Street Global Markets' research partnership, State
Street Associates (SSA), by Harvard University professor Ken Froot
and SSA Director Paul O'Connell, the State Street Investor
Confidence Index(R) measures investor confidence on a quantitative
basis, analyzing actual buying and selling patterns of
institutional investors. The index is based on financial theory
that assigns precise meaning to changes in investor risk sentiment,
or the willingness of investors to hold proportionally more or less
of their portfolio in equities. The more of their portfolio that
institutional investors are willing to devote to equities, the
greater their risk appetite or confidence. "Two years after the
launch of the State Street Investor Confidence Index(R), we remain
the industry's only quantitative measure of investor behavior,"
said Stan Shelton, executive vice president of State Street. "We
can now provide another level of insight into investor behavior by
assessing how risk tolerance varies across regions. This is yet
another testament to our commitment of providing our customers with
a broad array of tools they can utilize to reach their investment
objectives." "In the early part of this month, we saw some
retrenchment that dates back to before Hurricane Katrina, with
investors moving out of equities and seeking safety," said Froot.
"However, in the most recent weeks, the stimulative side of the
post-Katrina rebuild has become clear and oil prices have fallen
back. As a result of these later-in-the-month improvements, the
overall decline of global risk appetite in September was small."
"The global measure masks some of the regional differences," said
O'Connell. "While the confidence of North American and Asian
investors was flat to slightly up, the confidence of European
investors weakened considerably against the backdrop of an
uncertain outcome to the German election." Since its launch in
September of 2003, the State Street Investor Confidence Index(R)
has become a key economic indicator for asset owners, investment
managers and central banks. As the only index providing a
quantitative measure tracking the common buying patterns of
institutional investors around the world, the State Street Investor
Confidence Index(R) offers a unique look into the investment
behavior and decisions of thousands of professional investors and
their investment decisions. About State Street Global Markets:
State Street Global Markets provides specialized investment
research and trading in foreign exchange, equities, fixed income
and derivatives. Its goal is to enhance and preserve portfolio
values for asset managers and asset owners. From its unique
position at the crossroads of the global markets, it creates and
unlocks value for its clients with original flow-based research,
innovative portfolio strategies, trade process optimization, and
global connectivity across multiple asset classes and markets.
State Street Global Markets' research team of leading academic and
industry experts are committed to continually advancing the
science, including theory and application of its proprietary
investor behavior research and innovative portfolio & risk
management technologies to helps its clients challenge conventional
thinking, shape ideas, make more informed investment decisions and
deliver measurable results. About the State Street Investor
Confidence Index(R): The index is released globally at 10 a.m.
Eastern time in Boston on the second to last Tuesday of each month.
More information on the State Street Investor Confidence Index,
including frequently asked questions and a calendar of release
dates, is available at
http://www.statestreet.com/investorconfidenceindex. The previous
month's calculations for the index are revised to account for
trading activity through the end of the reporting period. About
State Street: State Street Corporation (NYSE: STT) is the world's
leading specialist in providing institutional investors with
investment servicing, investment management and investment research
and trading. With $9.6 trillion in assets under custody and $1.4
trillion in assets under management (as of June 30, 2005), State
Street operates in 25 countries and more than 100 geographic
markets worldwide. For more information, visit State Street's web
site at www.statestreet.com. This news announcement contains
forward-looking statements as defined by United States securities
laws, including statements about the financial outlook and business
environment. Those statements are based on current expectations and
involve a number of risks and uncertainties, including those
related to the pace at which State Street adds new clients or at
which existing clients use additional services, the value of global
and regional financial markets, the pace of cross-border investment
activity, changes in interest rates, the pace of worldwide economic
growth and rates of inflation, the extent of volatility in currency
markets, consolidations among clients and competitors, State
Street's business mix, the dynamics of markets State Street serves,
and State Street's success at integrating and converting
acquisitions into its business. Other important factors that could
cause actual results to differ materially from those indicated by
any forward-looking statements are set forth in State Street's 2004
annual report and subsequent SEC filings. State Street encourages
investors to read the corporation's annual report, particularly the
section on factors that may affect financial results, and its
subsequent SEC filings for additional information with respect to
any forward-looking statements and prior to making any investment
decision. The forward-looking statements contained in this press
release speak only as of the date hereof, September 20, 2005, and
the company will not undertake efforts to revise those
forward-looking statements to reflect events after this date.
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