Bank of America’s latest fund manager survey shows investors continuing to add to U.S. equities, pushing bullish sentiment to its highest level in nearly five years, according to Bloomberg. Data released by a team led by BofA strategist Michael Hartnett showed a net 56% of fund managers are overweight equities, the highest reading since November 2021. At the same time, cash allocations fell to what the survey described as a very low 3.5%.
The survey indicates that global investors have been raising stock exposure as risk appetite improves. Hartnett said positioning has become crowded and that bearish investors are dwindling. The report also said expectations for an economic soft landing, enthusiasm around artificial intelligence investment, and improving liquidity expectations have supported stronger allocations to risk assets. With cash holdings now at a low level, the survey noted that portfolios could face greater adjustment pressure if adverse market factors emerge.
Bank of America’s latest fund manager survey shows investors continuing to add to U.S. equities, lifting bullish sentiment to its highest level in nearly five years, according to Bloomberg.
Data released by a team led by BofA strategist Michael Hartnett showed that a net 56% of fund managers are overweight equities, the highest level since November 2021. Investor cash allocations, meanwhile, fell to what the survey described as a very low 3.5%.
Higher equity exposure, lower cash balances
The survey found that global investors have been increasing their stock positions, reflecting a clear rise in risk appetite. At the same time, that shift may leave less room for further upside. Hartnett said investor positioning has become crowded, while bearish participation in the market continues to shrink.
Risk appetite builds among institutions
The report said expectations for an economic soft landing, enthusiasm for artificial intelligence investment, and improving liquidity expectations are seen as factors supporting institutional demand for risk assets. It also noted that lower cash holdings could increase portfolio adjustment pressure if unfavorable market developments appear.
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