How low can it go?

Adviser confidence in the economy and stock market dropped even further last month, according to Rydex AdvisorBenchmarking Inc.'s Advisor Confidence Index. The index was down nearly 11% last month to 86.27, from 96.93 in June, the lowest mark in the history of the benchmark, which was launched in 2004. Each of the four economic-outlook components measured by Rydex worsened last month. Financial advisers were most pessimistic about the current economic outlook. The index is modeled on The Conference Board Consumer Confidence Index. The participants answer four multiple-choice questions each month to capture their views on the economy and stock market. They can choose one of five answers: from "very positive" to "very negative" for each question. Each answer carries a specific weighting. In addition, advisers submit comments about their views. "Advisers indicated the increased need to contact their clients more often during this time and to make sure the clients understand their expectations," said Maya Ivanova, market research manager at Rydex AdvisorBenchmarking. "The advisers also said they are using more alternative investments," she said. "They are looking for some way to have some investments that are non-correlated to the stock market." Rydex AdvisorBenchmarking, a Rockville, Md., research center and affiliate of Rydex Investments, focuses on the registered investment adviser market and each month surveys 150 advisers.