BofAML survey: Investors' risk-taking has hit an all-time high

'Indications of irrational exuberance'

Fund managers are showing signs of 'irrational exuberance' by increasing their overweight global equities positions and decreasing cash weightings, according to the latest Bank of America Merrill Lynch (BofAML) survey.

The November survey, which consisted of 209 panellists, found allocations to global equities had increased to net 49% overweight, the highest level since April 2015. Furthermore, average cash balances of portfolios fell to 4.4% from 4.7% last month, the lowest level since October 2013 and below the 10-year 4.5% average, while the net share of investors taking out protection against a correction in markets decreased this month to -37%. The 'Goldilocks' scenario, a combination of low inflation and strong growth, has become the "consensus" view for the global economy, with 56% of investo...