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Equity Exposure Plummets, Cash Holdings Jump As Investors Rethink 'US Exceptionalism,' Bank Of America Survey

Investor confidence is slipping fast, with cash levels surging and U.S. equity exposure crumbling to two-year lows, according to Bank of America's Global Fund Manager Survey.

The shift marks the biggest pullback in risk appetite in years, as fears of economic stagnation and a potential trade war weigh on markets.

Are Investors Losing Faith In The US Market?

The survey, released Tuesday by Bank of America’s chief investment strategist Michael Hartnett, reveals a sharp drop in investor optimism, with stock allocations plunging and cash holdings rising.

The most notable shift in sentiment is the fading belief in “U.S. exceptionalism.” A staggering 69% of fund managers surveyed believe that the theme—centered on the idea that the U.S. economy and stock market can outperform the rest of the world—has peaked.

This has led to a record rotation out of U.S. stocks, with allocation dropping 40 percentage points month-over-month to a net 23% underweight, the lowest since June 2023.

Allocations to global equities have slumped from a net 35% overweight in February to just 6% in March—the lowest level in over four ...