In 2015, markets around the world churned through periods of exuberance and panic, from the Shanghai SSE Composite's lofty high in May to the bottom falling out of oil prices throughout the year.

As 2016 gets underway, the news seems grim: oil has fallen to a 15-year low, panic selling has repeatedly closed China’s stock markets and the presidential election might be a match-up between a socialist and a reality TV star.

Investopedia readers are well-educated market participants who seek to become sophisticated investors. By collecting data on their reading choices, Investopedia can gauge investor sentiment to predict trends, identify market moods as they brew, and get clues on market movements before they happen.

Sophisticated investors of all ages are worried that their investments in their educations, their homes and their retirement may be in danger of another Great Recession or worse. How worried should they be? Our gauge of reader sentiment, the INV Anxiety Index, indicates that the worst excesses of market panic in several areas may already be past.

That's not to say that oil can't fall further, that the fundamentals are strong, or that exogenous shocks might not shiver the fragile global economy. To be sure, 2016 has had a rough start. But 2015's slow drip of bad news may have habituated investors to the point that caution has replaced greed and markets are ready to rebound.

Investopedia's Anxiety Index

Because Investopedia readers are "finance forward," we assembled a list of 13 Investopedia terms dating back to before the 2008 financial crisis that are most sensitive to investor anxiety and made them the basis of an "anxiety index." As you can see in the illustration below, the Investopedia Anxiety Index has spiked during every period of financial uncertainty over the last nine years.

According to a paper published by the European economists Funke, Schularick, and Trebesch, there is a direct correlation between financial crises and political movements, specifically far right parties benefit from financial insecurity. In the plot below, we have labeled a few of the political upsets that occurred at peak levels of investor anxiety.

The good news: our current peak is well below the peaks of 2008 and 2010, which implies longer odds for an anti-establishment candidate. There is, of course, plenty of time for sentiments to change between now and November, and we will keep checking in with the Anxiety Index throughout the year. 

To give you an idea of how well the Investopedia Anxiety Index predicts investor sentiment, we compared our index with the Chicago Board of Exchange's Volatility Index (VIX).

As you can see, in 2009, 2010 and in the summer of 2015, an increase in the Investopedia Anxiety Index preceded a much larger increase in the VIX. It is also worth noting that Investopedia readers as a group are slightly ahead of the curve when it comes to market volatility.

Overall, anxiety reached sustained high levels from 2010 through 2012 when volatility in stocks was relatively low. For people who remember those anxious years when the economy was growing but unemployment remained persistently high, this shows that the VIX isn't as accurate a measure of economic sentiment (what Keynes called animal spirits) as it is a measure of greed or fear in stock markets. 

The current economic expansion and pace of job creation began to ease investor fears starting in 2013 and picked up speed through 2014. But last year's bumpy ride has moved the needle back towards anxiety. The question is, what conclusions can we draw from this for 2016?

Commodities: Oil Is Oversold

One chart stood out in our analysis of reader habits over the last 24 months: as oil prices began to slide at the end of 2014, Investopedia reader interest around the keyword "oil" spiked through the beginning of 2015. But as oil prices continued to slide, reader reaction to the news was progressively muted.

We see spikes of interest – whether from greed or fear – every time oil drops through another unthinkable price level, but the spikes are lower and lower.

Though prices for both West Texas Intermediate (WTI) crude have lost 37% of its value between the end of June and the end of November, reader interest in oil as an investment did not rise as dramatically as it did between September 2014 and mid-January 2015 when WTI oil first broke to the downside.

Either general investors are pessimistic about oil, or uncertainty is being replaced with consensus about a new set of fundamentals in oil markets – possibly both. Either way, contrarians​ may find this is the perfect time to get into the market as everyone else heads for the exits.


This year the Social Security Administration changed two rules for retirees. The first is called file and suspend and the second is called deemed filing. Both rules closed what lawmakers considered loopholes to help retirees to increase the amount of benefits they receive. (For more on file and suspend, see: Social Security File and Suspend Claiming Strategy is Ending: Now What?)

Though people over 55 make up only 9.5% of Investopedia readers, they accounted for 85% of traffic to pages with content about Social Security.

Despite the bad rap they get in the press, Millennials​ are also thinking about retirement, but they aren’t thinking about Social Security. This may be because they don’t see it existing in their golden years, or it may be they just don't care about the intricacies of a bureaucracy that doesn't have an immediate impact on their lives. Nevertheless, retirement was definitely high on the list of our readers' priorities in 2015.

We expect more of the same in 2016. As more Baby Boomers retire and more Millennials enter the mature phase of their careers, interest in retirement, both in Social Security and alternatives to it, will be hot topics.

Interest Rates

Interest in bonds relative to stocks was high, even after the Fed began its Quantitative Easing program in late 2008 and interest rates were cut to zero.

At the beginning of the current bull market in 2012, interest in bonds fell off a cliff. It spiked in June 2013 when Ben Bernanke, then head of the Fed, announced tapering (the famous taper tantrum). Not only is interest in bonds at historic lows, it has barely budged since the Fed announced its latest rate hike.

Though as recently as three weeks ago markets expected the Fed to raise rates modestly throughout 2016, Investopedia readers have shown little to no interest in bonds, perhaps because low interest rates will be necessary to keep the U.S. economy afloat in the currently challenging macro environment.

The Bottom Line

Though the situation may change if new information is given to markets, at the moment Investopedia readers show little interest in commodities or investments that perform well when interest rates are going up. The Investopedia Anxiety Index has risen through the end of 2015, though not to levels that signal readers are worried about another recession in the U.S. or a successful dark horse candidate taking the presidency.

We will monitor the index to see if it spikes again, but for now the best financial advice for the average investor is keep calm and carry on.

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