Investors have piled into emerging market assets this year amid growing worries about rising corporate debt, falling inflation and weaker global economic growth. BAML did not specify whether the trade referred to bonds, equities or both.
Trade war topped the list of biggest tail risks for the ninth straight month, followed by a slowdown in China, the world’s No. 2 economy, and a corporate credit crunch.
The bank said the survey did not show any improvement in investor sentiment, with global equity allocations last month falling to their lowest levels since September 2016.