Bank of America’s July global fund manager survey shows investors are increasingly uneasy about how crowded the AI semiconductor trade has become, even as many have not yet called an end to the cycle. A record 82% of respondents said being long global semiconductors is the most crowded trade in the world. At the same time, positioning in tech stocks fell from a net 26% overweight to a net 18% overweight, pointing to some trimming of long exposure rather than a shift into outright short bets. The survey also found that 61% of investors do not expect hyperscalers to announce capital spending cuts this year. BofA said fears of an AI bubble have also climbed, with the share of respondents naming it as one of the biggest tail risks rising from 28% in June to 45% in July. Still, only part of the investor base sees AI stocks as already in bubble territory, while more respondents continue to describe the market as being in a boom phase, with momentum still pulling in capital even as positioning and valuation risks build.
Bank of America’s July global fund manager survey showed a split in investor views on the AI semiconductor trade. Most respondents have not bet that the cycle is over, but a growing share now sees the trade as excessively crowded.
The survey found that 82% of fund managers said being long global semiconductors is the most crowded trade globally, a record high. At the same time, tech stock positioning fell from a net 26% overweight to a net 18% overweight, suggesting investors have cut some long exposure without moving into outright shorts.
The survey also showed that 61% of investors do not expect hyperscalers to announce capital expenditure cuts this year. BofA added that an AI bubble has become one of the biggest tail risks, with the share choosing that answer rising from 28% in June to 45% in July.
Still, only part of the investor base believes AI stocks are already in bubble territory. More respondents continue to describe the market as being in a boom phase, with momentum still attracting capital inflows even as positioning and valuation risks rise.
The survey was conducted from July 2 to July 9 and covered 210 fund managers overseeing about $555 billion in assets.
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