Bank of America's August global fund manager survey showed investor optimism climbed to one of its highest levels since 2022, while cash allocations fell to 3.5%, a level that keeps BofA's contrarian cash rule in sell territory. The latest reading points to a market with heavily deployed positioning and limited liquidity buffers, leaving risk assets more exposed to shocks from growth, inflation or policy if fresh inflows fail to sustain the rally. The survey, conducted from Aug. 7 to 13 among 203 fund managers overseeing $581 billion, also showed global equity allocation rose to a 56% net overweight, the highest since November 2021. BofA's other contrarian gauge, the Bull & Bear Indicator, rose to 9.3, above the 8.0 threshold that also marks sell territory. The bank said this is the third time since 2022 that sentiment has reached such elevated levels. The broader backdrop remained unusually upbeat but fragile. A record 56% of respondents expect a no-landing outcome over the next 12 months, 43% expect a boom scenario, and a net 37% expect double-digit earnings growth, the strongest reading since August 2021. At the same time, managers flagged an AI bubble as the top tail risk, worried more about a disorderly rise in bond yields, and reported growing concern over corporate leverage. Against that backdrop, BofA highlighted contrarian ideas including long bonds and favoring undervalued assets such as gold or UK equities, areas where institutional positioning remains relatively light and which could offer more defensive performance if sentiment reverses.