Hedge Fund Managers More Bullish on S&P 500 in January 2012

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The latest TrimTabs/BarclayHedge Survey of Hedge Fund Managers reveals growing numbers of fund managers are becoming more optimistic about the prospects of U.S. equities. The survey of 108 hedge fund managers found bullish sentiment on the S&P 500 at 45.4% in January 2012, up from 42% in December and the second-highest reading since December 2010. Managers were surveyed in the third week of January.

While hedge fund managers are seeing brighter days ahead, the TrimTabs Demand Index is far less optimistic. "The Demand Index is down more than 50% since the beginning of January, which stands as a warning to bullish market participants,” Mirochnik says. The Demand Index, which monitors 21 key sentiment indicators to time U.S. equities, signaled a strong bullish stance in late November, just before the markets surged. “This sudden reversal in January is cause for caution,” Mirochnik says.

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