NEW YORK, May 10 (Standard & Poor's) - With apologies to Robert Shiller for borrowing from the title of his recent book warning investors about the market, it appears that some of us are a bit concerned about the market's recent heights.

The NASDAQ's plunge from March 10 to April 14 -- when investors lopped a third off its value in only a month of trading -- was probably sufficient to give many investors a bit of vertigo. And if that was not enough, Fed Chairman Alan Greenspan continues to worry about the stock market's effect on the economy and inflation.

Well, Personal Wealth may have found a sign that investors are becoming a bit more conservative. Last fall I wrote an article on major market reversals. Accompanying the article was a Quick Poll asking PW readers what they would do if the market took a short, deep tumble. (See When the Bear's on the Loose, originally published September 28 and Bulls ... with a Sense of History, October 7.) Over 70% of poll respondents said that they would never sell half their stocks -- no matter how big a plunge the market took.

This was a very impressive testament to investors' commitment to long term investing in stocks. So impressive that one of my colleagues doubted that everyone knew what they were saying...

Flash forward to May 2000. Earlier this week, we ran a poll asking people what they would do if they won "The Big Game", Tuesday's $350 million lottery. (A purely theoretical question for all respondents, unless those lucky folks in Michigan and Georgia happened to click by.) This time only 16% took the aggressive stance of putting all their winnings into tech stocks. Over 60% of the respondents went for a diversified portfolio of 25% muni bonds, 25% international equities, 25% technology stocks and 25% in the S&P 500. The most conservative option, 100% in munis, garnered 16%. A daring 7% of those polled would have set up their own venture capital company with the prize.

Could it be that investors are a little less convinced that markets rise all the time? This is not a very scientific analysis. The idea of comparing the results didn't come up until after the second poll ran, so the questions are not really comparable. Nevertheless, there is a strong hint that some rationality may be seeping into the market. Or, at least 60% of the people understand the benefits of diversification. That's certainly a positive.

Since the market's direction depends on how much investors are buying or selling, and since the PW editors are always curious, please take a moment to look at the following questions that are designed to see if investors' attitudes have shifted lately. Please click on the corresponding response on the Quick Poll at left.)

1. My opinion of the market hasn't changed in the last six months. I still think the only place to be for the long term is in stocks and another NASDAQ-style drop wouldn't scare me off.

2. Yes, there have been some scary moments, but this kind of thing is normal and I see little reason to change my long term strategy.

3. The risks of staying invested have risen and the rewards have not. I am thinking about moving some funds out of the market until things clear up.

4. I am worried that things are getting over-extended. I have already lightened up on my investments and will take more off the table if we get another rumble like early April.

Last fall's articles included a table showing the ten worst one-month drops in the S&P 500 since 1980. If you think we cheated by not including the 1973-74 bear market, make sure your answer above is not the most exuberant one.

NASDAQ's plunge in late March and early April took it down 34.2% in about a month. NASDAQ is about two-thirds technology and is not a broad based index like the S&P 500. During the same period NASDAQ plunged, the S&P 500 fell 2.76% -- not enough to make our list of the ten biggest one-month declines.

10-May-2000 16:58:05 (02764828)  Copyright 2000 Standard & Poor's Investment Advisory Services LLC. The information contained in this report may not be published, broadcast, rewritten or otherwise distributed without prior written consent from Standard & Poor's.