Cash Allocation by Non-Bank Investors Globally While cash was once considered king, non-bank investors globally have significantly reduced their cash allocations, reaching levels not seen since at least 1999. Image: J.P. Morgan
FMS Investors – Average Percentile Rank of Growth Expectations, Cash Allocation, Equity Allocation The decline in pessimism among FMS investors is viewed as a positive indicator, suggesting a growing willingness to embrace risk. Image: BofA Global Fund Manager Survey
FMS Average Cash Balance The FMS cash level’s recent decline to 3.9% has generated a contrarian sell signal for global equities. Historically, these signals often precede market corrections, prompting investors to reassess their strategies. Image: BofA Global Fund Manager Survey
GWIM Cash Allocation as % Asset Under Management BofA’s private clients have reduced their cash allocation, remaining below the long-term average, while increasing their equity exposure. Image: BofA Global Investment Strategy
Buybacks – S&P 500 Cash as % of Total Asset As S&P 500 companies’ cash reserves decline, Bank of America expects buybacks to peak soon. Image: BofA US Equity & Quant Strategy
S&P 500 Use of Cash and Buybacks Buybacks and dividends are expected to comprise 43% of cash use in 2024, while Capex and R&D will make up 46% of total cash spending. Image: Goldman Sachs Global Investment Research
FMS Investors – Net % Overweight Equities – Net % Overweight Cash FMS investors still show a greater inclination to invest in the stock market and less interest in holding cash, indicating their ongoing preference for higher-risk assets over cash reserves. Image: BofA Global Fund Manager Survey
Buybacks and S&P 500 Use of Cash Stock buybacks are just one potential use of cash by S&P 500 companies. Companies may choose to engage in buybacks to return cash to shareholders, and potentially enhance shareholder value. Image: Goldman Sachs Global Investment Research
Share of S&P 1500 Companies by Returning Cash to Shareholders Strategy Most S&P 1500 companies are returning cash to shareholders through both dividends and buybacks, which can significantly boost shareholder returns. Image: Goldman Sachs Global Investment Research
S&P 500 Free Cash Flow Despite a decline, the S&P 500 free cash flow remains higher than the historical trend, even during the current hiking cycle. Image: BofA Research Investment Committee
Cash + T-bills % of AUM Will cash and T-bills serve as the driving force behind the bull markets of 2024? Image: BofA Global Investment Strategy