Finance
Investors raise risk bets but cash flashes 'sell signal' - BofA survey
Published by Global Banking & Finance Review®
Posted on November 18, 2025
2 min readLast updated: January 21, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on November 18, 2025
2 min readLast updated: January 21, 2026
BofA's survey signals a sell alert as investors increase risk exposure, with cash holdings at 3.7%. Concerns over market valuation and AI bubble risks are highlighted.
MILAN (Reuters) -Global investors lifted equity and commodity allocations in November, but cash holdings fell to just 3.7%, triggering Bank of America's "sell signal" and raising concerns that bullish positioning could act as a headwind for risk assets, its monthly fund manager survey showed on Tuesday.
The November survey warned that frothy markets may face further downside without a Federal Reserve rate cut in December, with emerging markets and banks seen as most exposed to a risk-off move in the final quarter of 2025.
An AI bubble was the biggest tail risk for 45% of respondents, and a record share of investors said companies are "overinvesting", a sign spending by hyperscalers may need to slow down. Positioning remains crowded in technology, with 54% naming "long Magnificent 7" - the seven largest Wall Street stocks by market value - as the most crowded trade.
The survey, titled “Cash poor, capex rich, rate-cut needy”, showed investors are net 34% overweight global stocks, the highest since February, and most overweight commodities since September 2022.
Macro sentiment improved this month, with global growth expectations turning positive for the first time this year and 53% forecasting a soft landing.
Still, a record 63% believe equity markets are currently overvalued. And, asked about the most likely source of a systemic credit event, 59% mentioned private equity/private credit, the highest conviction since 2022.
The global survey of 172 fund managers overseeing $475 billion was conducted between November 7 and 13.
(Reporting by Danilo Masoni; Editing by Amanda Cooper)
Equity refers to the ownership interest in a company, represented by shares of stock. It signifies the value of ownership after all liabilities have been deducted.
Emerging markets are nations with social or business activity in the process of rapid growth and industrialization. They often present investment opportunities due to their potential for high returns.
A sell signal is an indication that an asset should be sold, often based on analysis of market trends or investor sentiment, suggesting a potential decline in value.
Valuations refer to the process of determining the current worth of an asset or company, often used by investors to assess investment opportunities.
Investor sentiment is the overall attitude of investors toward a particular security or financial market, often influenced by market trends, news, and economic indicators.
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