Bank of America’s December Global Fund Manager Survey shows investors holding just 3.3% of portfolios in cash (record low) while allocations to stocks and commodities are the highest since Feb 2022. BofA’s framework flags cash below a 4% sell threshold as historically preceding weaker equity performance; the bank usually recommends buying when cash reaches 5%+. Fund managers are the most overweight equities since last December, with technology most favored. BofA warns liquidity may have peaked and expects fewer 2026 rate cuts and reduced government stimulus as US debt-to-GDP rises.

Facts from the summary: cash at 3.3% is the lowest on record; allocations to stocks and commodities are the highest since Feb 2022; BofA’s historical framework treats cash below 4% as a sell signal and recommends buying when cash is ≥5%; fund managers carry their largest equity overweight since Dec last year; BofA warns liquidity may be peaking and expects fewer 2026 rate cuts and fading stimulus. These facts support a moderately bearish sentiment and a meaningful (but not extreme) short-term market impact for traders.