BofA's latest Fund Manager Survey reveals the most aggressive risk rotation since 2013. Money is sprinting up the risk curve:
- Global growth outlook: +33 point surge to +23% (July 2021 high)
- US growth expectations: +50 point leap to +28%
- Small-cap rotation: Massive 29-point swing to 35% overweight
- Risk appetite metrics: Highest since pre-COVID
- Capital flight from defensive sectors to cyclicals
- Value stocks seeing largest inflows since 2020
- Micro-caps and high-beta names experiencing record buying pressure
Institutional investors are abandoning safety plays and aggressively rotating into higher-beta, smaller-cap names. This risk-seeking behavior typically marks major market regime changes.