U.S. Stock Market – Margin Debt and Free Cash Balances The record surge in margin debt reflects heightened risk-taking among investors. If retail enthusiasm persists, this trend may continue, but elevated margin debt levels could amplify market volatility. Image: Real Investment Advice
AAII – U.S. Retail Investors Allocation to Stocks, Bonds and Cash High equity allocations and low cash positions don’t always mean a market reversal is near. However, they suggest that much of the market’s potential gains may already be priced in, as investors have heavily committed to equities. Image: Real Investment Advice
U.S. Households’ Allocation to Equity, Bond and Cash Current high levels of U.S. household equity allocation may signal potential risks for future investors, as historical trends suggest this often precedes lower market returns. Image: Goldman Sachs Global Investment Research
Buybacks and S&P 500 Use of Cash S&P 500 companies are showing stronger growth in capital expenditure compared to share buybacks, signaling a shift in corporate spending priorities. Image: Goldman Sachs Global Investment Research
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