Bank of America Survey: 56% of Fund Managers Overweight Equities, Fund Cash Levels Drop to 30-Year Low of 3.5%
Bank of America's monthly survey shows that 56% of institutional fund managers are currently overweight equities, while the cash allocation among funds has dropped to 3.5%, one of the lowest levels in 30 years, falling below the bank's 4% "sell" contrarian indicator. Furthermore, Bank of America's Bull & Bear Indicator has flashed a "red sell signal" for three consecutive months, currently standing at 9.3, above its 8.0 "extremely bullish" trigger point. Michael Hartnett, the bank's chief investment strategist, advises "retreat/rotate, don't reload," meaning to withdraw from risk assets and rotate into defensive assets, duration assets, and the U.S. dollar.
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