BofA survey: fund managers most bearish in 10 months

Bank of America's Global Fund Manager Survey, conducted in early April, found a net 36% of surveyed managers expect a weaker global economy. The survey showed equity allocations fell to a net 13% overweight, down from 37% in February and reversing a net 7% who had expected growth earlier in the year.

The monthly poll covers roughly 200 to 400 institutional fund managers who oversee hundreds of billions of dollars. Bank of America described the results as a notable pullback in risk appetite, with many managers reducing equity exposure and repositioning portfolios.

On policy expectations, 58% of respondents forecast the Federal Reserve will cut interest rates over the next 12 months. Meanwhile, 46% of managers expect the European Central Bank to raise rates during the same period. Commodity views were mixed: 34% of managers projected oil trading between $80 and $90 per barrel by the end of 2026.

Bank of America noted that the survey often serves as a contrarian indicator. The bank pointed to recent market moves tied to positioning, including a sharp drop in precious metals in late January and a surge in the U.S. dollar in March, as examples of rapid reversals when positioning becomes lopsided.

Survey commentary cited the U.S.-Iran conflict as a factor that had altered growth and inflation expectations and affected prices. Bank of America’s analysis added that, if the conflict ends and the Strait of Hormuz reopens, market strategies being considered include short positions in oil and increased exposure to equities, conditional on that geopolitical outcome.

The Fund Manager Survey is followed by investors for its snapshot of how large institutional managers are positioned. The latest results indicate a move toward risk reduction and a reassessment of growth prospects after heavier equity allocations earlier in the year.