Investors’ cash pass increased with the Fed’s policy tightening expectations and taxation risks getting stronger Author Reuters


© Reuters.

LONDON, April 13 (Reuters) – According to the fund managers survey conducted by BofA, investors increased the amount of cash in their portfolios.

Rising expectations in inflation, changes in taxation and concerns that the Fed would tighten monetary policy made stocks vulnerable to declines.

A similar situation happened in 2013, when investors learned that the Fed would tighten its excessively loose monetary policy, and panic sales were seen in the markets.

Although the majority of investors surveyed said that stocks do not have bubbles, BofA announced that positions reached a record high, with approximately 62% of investors increasing their weight on stocks.

The unprecedented financial aid initiated in the USA due to the epidemic triggered inflation concerns, causing investors to increase their expectations for a rate hike.

Concerns that the US Federal Reserve will tighten monetary policy are seen as the biggest risk among investors.

In the past few weeks, discussions about a minimum global corporate tax and an increase in US corporate tax have distorted the stock outlook.

Fund managers who took BofA’s survey increased their cash from 3.8% in February to 4.1% last week.

Reported by: Thyagaraju Adinarayan
Translated by: Canan Sevgili
Proofreading: Birsen Altaylı

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