Expect a U or W-shaped recovery - BofA survey

Just 10% of investors anticipate V-shaped recovery

James Baxter-Derrington
clock • 2 min read

Investors are markedly bearish, with 75% anticipating a U or W-shaped recovery from the economic fallout of the coronavirus pandemic compared to just 10% expecting a V-shape, according to the latest global fund manager survey from Bank of America.

A second wave of coronavirus ranks as the greatest tail risk by far, with 52% of managers surveyed citing it, while permanently high unemployment (15%) and a break-up of the European Union (11%) claim the second and third spots. Managers dismiss sell-side concerns as US equities near tech bubble highs Cash levels have dipped slightly to 5.7% from April's 5.9% but remain well above the 10-year average of 4.7%, which indicates that a "buy signal" is a contrarian bet. In line with this "extreme bearish" investing, those who responded are underweight cyclical assets, such as energy and...

To continue reading this article...

Join Investment Week for free

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now

 

Already an Investment Week
member?

Login

More on Markets

How big an impact could global elections have on portfolio allocation in 2024?

How big an impact could global elections have on portfolio allocation in 2024?

US, UK and India main focuses

Investment Week
clock 19 February 2024 • 8 min read
Hotter than expected US inflation tempers Fed rate cut expectations

Hotter than expected US inflation tempers Fed rate cut expectations

Annual price growth falls to 3.1%

clock 13 February 2024 • 1 min read
Investors turn defensive in January as rate cut expectations change

Investors turn defensive in January as rate cut expectations change

State Street Risk Appetite index

clock 08 February 2024 • 1 min read
Trustpilot