Global Fund Manager Optimism Surges, Reaching Multi-Year Highs

Global fund managers have entered 2026 with a remarkably bullish outlook, signaling a significant shift in market sentiment. Recent surveys indicate the highest levels of optimism in several years, driven by expectations of a “soft landing” or even a “no landing” scenario for the global economy. This surge in confidence is prompting a “risk-on” approach to asset allocation, with investors increasingly favoring growth-oriented investments.

Bullish Sentiment Reaches Multi-Year Highs

A December 2025 Bank of America (BofA) Fund Manager Survey revealed an investor sentiment score of 7.4, the most bullish reading in four and a half years [1]. This level of optimism, historically observed only eight times this century, often precedes periods of strong economic growth and substantial asset price movements.

The survey findings suggest a consensus among investment professionals that the global economy is poised for continued expansion, alleviating fears of a significant downturn. Specifically, 57% of respondents anticipate a “soft landing” – where inflation moderates without triggering a recession – even as 37% foresee a “no landing” scenario, indicating sustained strong growth. Only 3% now expect a “hard landing,” the lowest percentage in two and a half years [1].

Shift Towards Risk-On Asset Allocation

Reflecting this heightened confidence, fund managers are actively increasing their exposure to growth-oriented assets. Allocations to stocks and commodities are at their highest levels since early 2022 [4]. Equity buying allocations reached 42% in December 2025, the highest level since December 2024 [4].

Cash levels have plummeted to a record low of 3.2% [3] and 3.3% [4], falling below the “sell signal” threshold of 4% and the 3.5% danger zone [4]. Historically, when cash levels fall below 3.5%, the MSCI ACWI has tended to return -2% over the next month [4].

Bank of America Global Research Insights

Bank of America (BofA) Global Research provides comprehensive investment insights through publications like the RIC Report and the Global Fund Manager Survey [1]. BofA Data Analytics leverages social media monitoring, industry surveys, and alternative data to uncover new investment opportunities across sectors, regions, and asset classes [1]. Their research covers global economics, investment strategy, equity research (covering approximately 4,000 companies), and credit research [1].

Key Takeaways

• Global fund manager sentiment is at a multi-year high, reaching 7.4 in December 2025.
• Expectations for a “soft landing” or “no landing” scenario are driving bullishness.
• Investors are shifting towards risk-on assets, increasing allocations to stocks, and commodities.
• Cash levels have fallen to record lows, potentially signaling a market correction.

The current surge in optimism presents both opportunities and risks for investors. While the positive outlook suggests potential for continued growth, the historically cautionary signals associated with low cash levels warrant careful consideration and risk management.