The index assigns a precise meaning to changes in investor risk appetite: the greater the percentage allocation to equities, the higher risk appetite or confidence.

Investors are continuing to lose faith in North America, but are eyeing potential in both Europe and Asia, new data shows. 

Investor confidence in North America continued to decline in September, according to State Street’s Global Investor Confidence Index, which logged a 6.3 point drop for the continent this month. This helped drive down the index’s overall score from August’s reading of 106.8 to 104.4. For context, a reading of 100 is neutral. 

“The regional breakdown of our Investor Confidence Index this month reveals rather diverging paths,” said Kenneth Froot, who co-created the index alongside Paul O’Connell. “Confidence has strengthened in Europe and Asia on the back of optimistic economic conditions. However, it has weakened in North America with renewed geopolitical concerns and the [Federal Open Market Committee] FOMC’s pivotal decision to gradually trim its $4.5 trillion portfolio."

Meanwhile, State Street noted that its European iteration of the index swelled 4.7 points to 93.7, and the Asian version rose 3.7 points to reach 102.8.