'Buy signal' as managers raise cash to highest level in 14 years

BofA Merrill Lynch survey

Fund managers around the globe have raised their cash balances to the highest levels since 2001, generating an "unambiguous buy signal", according to Bank of America Merrill Lynch.

In its latest fund manager survey, which had 198 respondents and was carried out between 5 and 11 February, the group revealed global fund managers had raised cash balances to a long position of 5.6%, the highest it has been since November 2001. As a rule, BofA Merrill Lynch said when cash is raised over 4.5% an unambiguous (or contrarian) buy signal is triggered for equities. The percentage of fund managers remaining overweight equities has fallen from net 21% to just 5%, as investors rotated out of banking stocks and equities overall, into cash, utilities, bonds and telecoms during ...