FOMO at Heart of Rally Participation: Poll

A new poll indicates portfolio managers who spent much of the summer worried about an impending recession are now instead afraid of losing out as the stock market heads for new record highs.

Bank of America Merrill Lynch's latest monthly survey of global fund managers found that cash levels posted their largest decline since President Donald Trump’s 2016 election to 4.2% from 5% as investors rushed to take on risk. Cash on hand is now at its lowest level since June 2013.

One bank official also said that manager global growth optimism surged by the most in 20 years to 18-month highs, a sign investors expect better manufacturing and profit numbers worldwide.

"FOMO" or fear of missing out, is a commonly used term among traders to describe herding behavior by investors when the market starts to gain rapidly.

Investors still said "trade war" is the number-one trail risk to a rebound in equities, but bulls noted that a “trade truce” might be enough to keep stocks grinding higher to records, the official said.

The Bank of America survey, conducted Nov. 1 through Nov. 7, included 230 panelists with $574 billion in assets under management. The monthly survey is the most-watched poll of its kind among Wall Street investors and traders.