A recent Bank of America fund manager survey revealed a historic low in cash allocation among investors, signaling extreme confidence in the stock market. The survey highlights a trend of declining cash holdings and increasing investment in equities.
A Bank of America fund manager survey showed a new low on cash allocation going back to at least 2001. The data shows super-bullish sentiment, the firm's investment strategist Michael Hartnett wrote to clients. A closely watched survey of global fund managers registered its lowest cash allocation on record this month, underscoring a bullishness on stocks as the equity market nears the end of a strong year.
The average cash allocation level of participants in Bank of America's Global Fund Manager Survey fell to 14% underweight, according to data released by the bank on Tuesday. That is the largest underweight position for currency compared with stocks since at least 2001, when the survey began, the firm said. Put simply, the data shows super-bullish sentiment, investment strategist Michael Hartnett wrote to clients on Tuesday.He cited interest rate cuts from a compliant Federal Reserve and expectations for growth under President-elect Donald Trump as drivers of the rush into stocks. For the former, traders will get a reading of the Fed's thinking on Wednesday when the central bank delivers its final interest rate decision of the year in the afternoon. Fed funds futures are pricing in a more than That stat of net 14% underweight on cash marks a significant turn from the 4% net overweight reading in November. This 18 percentage-point drop in cash allocation was the largest monthly decline in around half a decade, according to Bank of America data. A new ‘super funding' limit for some 401(k) savers goes into effect in 2025. Here's how to take advantageWhat's more, the average cash level of surveyed managers fell to 3.9% from 4.3% of assets under management, hitting a new low going back to June 2021. That marked the second time in the last three months that this level fell below the key 4% mark, which Hartnett said triggers a contrarian sell signa
CASH ALLOCATION STOCK MARKET BULLISH SENTIMENT BANK OF AMERICA SURVEY FUND MANAGERS
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