Global investors trimmed cash holdings to an average 3.9% of portfolios in August, the lowest level since February, according to Bank of America’s latest Global Fund Manager Survey. The poll covered 169 managers overseeing a combined $413 billion and signalled the most bullish positioning in six months. The optimism sits uneasily with mounting valuation concerns: a record net 91% of respondents judged U.S. equities expensive after the market’s rebound from April’s tariff-led sell-off, and 70% now anticipate a period of stagflation. A potential escalation in the U.S.–China trade conflict was viewed as the biggest tail risk (29%), followed by inflation that could delay Federal Reserve rate cuts (27%). Positioning remains dominated by technology behemoths. Some 45% of managers called the “long Magnificent 7” trade—the collective bet on stocks such as Nvidia and Microsoft—the most crowded in global markets. Allocations show managers underweight the U.S. dollar and rotating toward emerging-market equities, while cash levels below 4% historically flash a sell signal for global shares, BofA noted. Rate expectations continue to pivot lower: 78% of those surveyed foresee short-term borrowing costs falling over the next year. Consensus forecasts put the 10-year Treasury yield at 4.30% in both three and 12 months, while the two-year note is expected to ease from 3.75% to 3.50%. Looking ahead to the 2026 leadership transition at the Fed, 20% of participants tip Governor Christopher Waller as the most likely successor to Chair Jerome Powell, ahead of Kevin Hassett (19%) and Kevin Warsh (15%).