‘Irrational Exuberance’ May Rule the Roost in Stock Markets
- BAML fund-manager survey shows risk taking at all-time high
- Investors see stocks as overvalued but bullish on growth
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Investors are riding a wave of “irrational exuberance” as they extend bullish positions even as they fret over valuations, according to the latest fund-manager survey by Bank of America Merrill Lynch.
While a record net 48 percent of investors say stocks are overvalued, a net 16 percent say they are taking on above-normal levels of risk, another all-time high. Investors are also taking out less downside protection and holding less cash, the survey shows.