Americans aren't expecting another bang-up year for the stock market, according to a new Associated Press-GfK poll.
Of the people polled, 40 percent think the market will stabilize where it is now by the end of 2014, with 39 percent predicting that it will drop, but not crash. Only 14 percent believe the market will rise and 5 percent think it will crash.
The Standard & Poor's 500 index has surged 24.5 percent, to 1,775 in 2013, putting it on track for its best year in a decade.
The rally has been fueled by higher corporate earnings, a slow recovery in the U.S. economy and stimulus from the Federal Reserve.
Perhaps because of the slow recovery, only about half of the general public noted the market's strong performance, according to the poll. Investors were more aware of the booming market, however, as 73 percent say it improved.
William Leyser, 74, a retired machinist from Las Vegas, thinks the stock market may fall by as much as 10 percent next year. He has taken some of his money out of stocks this year and put it into bonds.
"I'm concerned there is going to be a big correction here," says Leyser, who invests in mutual funds. "When it gets high, it always goes down a little bit."
The poll also shows that individuals are less optimistic about the outlook for the stock market than many investment professionals.
While few market strategists expect stocks to keep climbing at the same pace, many see them extending their gains at a slower rate.
Bank of America Merrill Lynch predicts the S&P 500 index will end next year at 2,000, about 13 percent higher than its current level. Wells Fargo Advisors forecasts the index will climb as high as 1,900, a gain of about 7 percent.
Stocks have rallied since bottoming out after the financial crisis and the start of the Great Recession, lifting the S&P 500 index 162 percent from its low in March 2009. Despite those steady returns, the poll suggests that Americans are still nervous about buying and holding stocks.
Of those polled, 71 percent consider investing in the stock market to be "generally risky," compared with 27 percent who think of the market as "generally safe."
The perception of stocks as a risky investment has lessened since the spring, when 75 percent of respondents said it was "generally risky" and 18 percent said it was "generally safe."
Still, with interest rates on savings accounts low, some individual investors recognize the need to take on more risk.
"If you want to see some growth in your portfolio you have to go into equities," says Mark Geduldig-Yatrofsky, 64, a former IT worker who lives in Portsmouth, Va.
Overall, 20 percent of investors say they plan to invest more heavily in the market in the coming year, 22 percent will pull back, and 57 percent plan to invest at about the same level as in 2013.
The AP-GfK Poll was conducted Dec. 5-9, 2013, using KnowledgePanel, GfK's probability-based online panel. For results based on all 1,367 adults, the margin of sampling error is plus or minus 3.5 percentage points.
KnowledgePanel is designed to be representative of the U.S. population. Respondents were first selected randomly using phone or mail survey methods, and later, completed this survey online. People selected for KnowledgePanel who didn't otherwise have Internet access were provided with access at no cost to them.
The poll should not be considered a predictor of future performance for the stock market.