BofA, managers prefer stocks to bonds
(Teleborsa) – I fund managers globally have become more bearishor pessimists, ad April 2023with the credit crunch seen in recent weeks leading to pessimism about global growth and the highest bond allocation since March 2009. This is what emerges from the usual Global Fund Manager Survey by Bank of America (BofA).
L’liquidity allocation has remained above the 5% tactical “buy” signal, present since November 2021. Liquidity levels have therefore remained above 5% for 17 consecutive months, a time span surpassed only by the 32-month DotCom bear market .
Fears of a credit crunch push the bond allocation up 9 percentage points month on month to 10% net Overweight, the largest overweight since March 2009, according to the research. And also the investors underweight in equities relative to bonds it is now at levels not seen since the Great Financial Crisis.
According to the managers interviewed, the most likely source for a “credit event” are US/EU commercial real estate (48%), followed by US shadow banking (25%), US corporate debt (6%), US Treasury debt downgrade (4%), real estate in China (4%) and debt European sovereign (3%).
BofA also says investors are back to defensive stocks (utilities, staples, healthcare) compared to cyclicals (discretionaries, banks, energy, materials), driven by large rotations from banks & materials to healthcare & utilities.
The busier locations sono invece: Long big tech stocks (30%); Short US banks (18%); Long China equities (13%); Short REITs (12%); Long European equities (11%); Long US dollar (5%).
(Photo: Photo on Nick Chong su Unsplash)
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