Despite the steady rise in the stock market, most investors won’t believe that the recession is over until they see a dramatic drop in unemployment rates, the most recent Spectrem High Net Worth Advisor Insight, states.

The survey, released Wednesday, said 70% of respondents said a drop in unemployment will signal the end of the recession versus 30% who believed a rise in the stock in the stock market would mean a turnaround. Moreover, over 40% of investors polled said that unemployment rates would have to drop below 7% for them to believe the recession was over.

In line with these findings, cash and fixed income remain at all-time highs, while stock investments and real estate have crept up. The overall trend: Investors are gradually moving back into the markets.

Millionaires are much more optimistic about the investment outlook, according to Spectrem’s Millionaire Investor Index and Affluent Investor Index. As a result, said Catherine McBreen, a managing director at Spectrem, “millionaires are more likely to start investing.”

The results of the survey coupled with the index findings are “really important for advisors to know because they’re going to [face] resistance [from clients] right now to going back into the market and allocating to stocks,” McBreen said.

There are some signs that the wealthy are heading back into stocks, albeit cautiously. Spectrem’s Millionaire Investor Index rose steadily from January through August to -10 from -16, while the Affluent index rose only slightly from -18 to -19.
    
The percentage of millionaires “not investing” dropped to 6.5% from 9.4%. That ties in with the percentage of millionaires going into stocks, a figure that rose to 44.4% from 35.2%.

Meanwhile, the affluent remained more skittish. The percentage of affluent “not investing” dropped to 14.6% from 15.1%.

Investors overall remained in cash (over 60%) and bond investing rose significantly to 26.1% from 19.1%. “People are still not investing,” McBreen noted, “or [they are] investing in cash. Those going into stocks tended to be between 35 to 40 in age.” However, those in the 45 to 6- age bracket, she said, “are really timid but really need to gain back what they lost.”

Spectrem, a Chicago-based consulting firm, conducted the survey in August, polling 500 investors with net worths ranging from $100,000 to $1 million.